SABMiller looks to developing markets

published 24 May 2012

Strong growth in Latin America and Africa offset declines in crisis-torn Europe for lager brewer SABMIller last year.

Group revenue in the 12 months to March 31st rose 11% to $31,388m from $28,311m the year before.

Earnings before interest, tax and amortisation (EBITA) rose 12% to $5,634m from $5,044m a year earlier while adjusted profit before tax climbed 13% to $5,062m from $4,491m.

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On a regional basis, Latin America EBITA was up by 14% as a result of volume growth, pricing and mix, and Asia Pacific EBITA was up 30% with good growth in both China and India.

In SABMiller's home territory, South Africa, beverages EBITA rose by 14% due to price and mix benefits and a focus on cost productivity, while for Africa as a whole, EBITA was up 16%.

Europe saw EBITA decline by 9% due to lower volumes, adverse mix and increased raw material costs. A strong pricing environment and favourable mix increases helped North America increase EBITA by 2% despite lower volumes.

Adjusted earnings per share improved by 9% to 134.4p from 123.4p in the prior year, and was ahead of market expectations of 133.76p.

Lager volumes in the year totalled 229m hectolitres (hl), 3% ahead of the prior year on an organic basis with particularly strong growth delivered in Latin America and Africa. Soft drinks volumes of 49m hl were 7% ahead of the prior year on an organic basis.

Trading conditions are expected to be broadly unchanged with further growth in developing markets but with no more than modest improvements in consumer spending in some more developed economies, the group said.

Unit input costs are expected to rise in mid-single digits in constant currency terms.

"Focus will be maintained on cost effectiveness, including synergy delivery in Australia, and on expanding our globally-managed procurement programmes. While healthy cash generation will again be a priority, targeted investments in production capacity, marketing and sales capability and business systems will continue in order to drive medium term growth," the company said.

The full year dividend has been hiked 12% to 91.0 cents from the previous year's 81.0 cents.