SABMiller’s volumes rise fuelled by emerging markets

By Helen Glaberson

- Last updated on GMT

Related tags Developed country

Volumes were boosted by continuing growth in emerging markets for SABMiller, who remained tight-lipped on its Fosters bid in its first quarter results.

SABMiller, who is currently pursuing a multi-billion dollar takeover of Australian firm Fosters, said underlying lager and soft drinks volumes had grown by five per cent year on year.

The beverage giant put volume growth down to “the strength of our brand portfolio and commercial execution, growth in consumer spending in many developing markets, and a relatively weak comparative quarter in the prior year”.

Revenues increased by seven per cent, aided by price rises made to offset raw material costs, according to SABMiller.

African and Asian growth

The world’s second biggest brewer by volume was supported by a strong performance in Africa and Asia.

Quarterly underlying volumes grew by 15 per cent in Africa, on an organic basis.

The firm said growth was boosted by enhanced distribution, the strength of local brand portfolios and generally favourable economic conditions.

Lager volumes grew 11 per cent in Asia, led by a 14 per cent increase in China volumes.

“Further share gains and improved weather conditions, compared to the severe storms that affected the prior year, underpinned China's growth with strong performances in the west and central regions,”​ said the firm.

Volumes grew six per cent in Latin America and five per cent in Europe. In South Africa, volumes were flat.

Sluggish growth in developed markets

Growth in developed markets was slow. MillerCoors' US domestic sales to retailers were down 2.7 per cent, which the company put down to a continued weak economic environment, ongoing high unemployment levels and subdued consumer spending affected by high fuel prices and poor weather.

SABMiller and AB-InBev, the world’s biggest brewer by volume, have benefited from growth in emerging countries, according to Reuters.

Other brewing giants, such as Heineken and Carlsberg, have been held back by their larger exposure to flat European markets, claims the news source.

Foster’s bid

The firm did not reveal anything about any potential move on Fosters, for which it made a A$11.2bn (including debt) bid for last month.

“Although the firm rejected the bid, analysts believe a sweetened bid may succeed,”​ said Reuters.

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