SABMiller boosted by international volume growth

By Neil Merrett

- Last updated on GMT

Related tags Volume growth Europe Brand Africa

SABMiller enjoyed a strong start to its fiscal year, with
organic sales volumes of its lager brands up 13 per cent in the
quarter ended 30 June the company said today.

In an interim statement at the company's annual general meeting, Graham Mackay, chief executive, said the company had increased investment spend and was facing higher input costs, factors that might affect profits.

The company posted strong volume growth throughout the majority of its international markets, Mackay told shareholders.

In Latin America, volume sales of the company's lager brands were up 12 per cent for the quarter, resulting from favourable economic conditions.

In Columbia, the group said that the relaunch of Aguila, the country's leading beer brand, and restructuring of its operations, was paying dividends.

Meanwhile a recent change in packaging led to market share gains for its Cristal beer brand in Peru, Mackay said.

In Europe sales volumes of beer rose 17 per cent.

Mackay said the company was boosted by market share gains in the majority of its markets in the region.

Hot weather through most of the continent in April and May drove a strong increase in sales for the group, though wet weather in June resulted in a slow down in volume growth, he said.

Central and Eastern Europe dominated the region, with volumes up by 52 per cent in Romania alone through increased capacity and the successful repackaging of its Timisoreana brand.

Volumes were also up by 20 per cent in both Russia and Poland, despite unfavourable comparative factors, such as the affect of last year's football world cup on sales, he said.

In Western Europe, the company recorded a three per cent improvement in branded volumes through its Italian operations.

The group posted a 0.7 per cent organic decline in North American domestic sales through its Miller brand, attributed to increased pricing for its products.

The figure excluded acquisitions made in the previous year, he said.

To offset this decline, SABMiller has expanded its portfolio with more premium higher cost brands like Peroni and Leinenkugel's, which both underwent double digit volume growth, Mackay said.

In Asia and Africa, SABMiller posted organic volume growth of 23 per cent for its lager brands, helped by the strength of the market in China.

Through its operations in Africa, the group increased sales volumes by five per cent on an organic basis, with strong growth of its brands in Tanzania, Mozambique and Botswana, he said.

Lager volumes rose four per cent in South Africa, while the performance of its soft drink brands improved by 13 per cent, driven by hot weather conditions in May and April.

Outside the US, SABMiller is one of the largest bottlers of Coca-Cola products, the company said.

SABMiller posted $3.1bn in profits for the financial year ended 31 March, with sales of $18.6bn.

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