E-Malt.com News article: 1829

The world's second-largest brewer, SABMiller plc, announced on November 20 its six-month results to 30 September 2003. The company has registered a turnover of US$ 6,328 million a 59% increase from the same period last year. “Strong underlying business performance delivered excellent results with group EBITA up 61% and adjusted earnings per share up 32%. Organic, constant currency EBITA growth of 21% was impressive with, notably, Europe up 27% and Beer South Africa up 14%. Our Africa and Asia business once again delivered a good performance from its widespread portfolio with EBITA up 18%. In Miller, the emphasis remains firmly on our longer-term strategy and action plans. Progress is being made in each of the four key focus areas, whilst financial performance remains in line with our expectations. Our Central America operation is starting to benefit from our initiatives to enhance its brand portfolio and distribution activities. We have strengthened our international operations and enhanced our future growth potential through selective strategic acquisitions, which we have financed from our strong internal cash flows and available borrowing facilities,” said Graham Mackay, Company’s Chief Executive.

Total beverage volumes were 93 million hectolitres (hls), a 24% increase on the comparable six-month period, with organic growth of 2.3%. Lager beer volumes were up 31% to 76 million hls, representing organic growth of 3.2%.

SABMiller, based in London, the maker of Miller Lite, Castle and Pilsner Urquell beers said it was starting to see a better performance from Miller Lite in recent months and believes brand volumes may stabilise early next year as part of its three-year recovery plan. SABMiller, known as South African Breweries before it bought U.S. brewer Miller for $5.6 billion in 2002, made earnings before interest, tax and amortisation (EBITA) of $889 million for the six months to September 30, beating analyst forecasts of $758-847 million.

SABMiller’s European businesses delivered a 51% increase in EBITA in the half-year, assisted by generally good summer weather, with 27% organic growth in constant currency terms. The company anticipates continued growth in our key European markets, supported by favourable economic and structural trends as new countries enter the European Union. It will build on our strong in-country positions to take advantage of the growing demand for international premium brands. In Italy the integration of our newly acquired operation, Peroni, is proceeding according to our expectations.

Norman Adami, head of the Miller unit, said overall Miller volumes dipped 4.4 % in the first half in a slightly lower U.S. market, but Miller Lite fell 1% and he expected volumes may stabilise for its leading brand early next year. Adami launched a three-year recovery plan in May to pull the second-biggest U.S. brewer out of a fall in its domestic market share, now down to around 19 percent, while Miller Lite is now starting to gain from the growth in low-carbohydrate beers.

But Miller faces a stiff task against the world's biggest brewer, Anheuser-Busch, maker of Budweiser, which controls half the U.S. market, Reuters reported. However, analysts point out that Anheuser has seen mixed success in low-carb beers with Michelob Ultra gaining, but Bud Light suffering. SABMiller has been busy since moving to London in 1999, using a paper trail of equity and bonds to fund acquisitions such as in Central America in 2001, Miller in 2002 and Peroni this year.



21 November, 2003