SABMiller plc Trading Update
12 October 2006
SABMiller plc today provided an update regarding trading during the six-month period to 30 September 2006, which is the first half of its current financial year. The calculation of the group's organic growth rate excludes volumes for South America which became part of the group in October 2005.
“The group’s lager sales volumes grew by some 9% on an organic basis in the period, whilst financial performance was in line with management’s expectations.
In South America, favourable trading conditions continued with all countries delivering strong performances, resulting in 11% growth overall in lager volumes for the first half, on a pro forma basis. In Peru, competitor activity at lower prices has stimulated sales volumes. Our integration activities in the region are proceeding well, and we have commenced a period of increased investment in the market place as evidenced by the recent launches in the premium segment of Peroni Nastro Azzurro in Colombia and Barena in Peru. In Central America, both beer and soft drink volumes were up by some 6%, reflecting an improvement in trading conditions.
Europe continued to perform well with organic growth in lager volumes of 8%, assisted by additional consumption during the World Cup. Poland continued to achieve strong growth notwithstanding challenging comparatives, driven by our principal Polish brands, Tyskie and Zubr, which are the top two brands in the market. Russia recorded volume growth of over 20%, reflecting double digit gains for Zolotaya Bochka, Kozel, Miller Genuine Draft and Redds. Romania also reported double digit growth, driven by our Timisoreana brand. Both the Czech Republic and Italy achieved marginal growth in volumes. Our new UK business maintained its good momentum, and during the period Peroni Nastro Azzurro volumes increased by over 25%.
In North America, Miller’s US domestic sales to retailers (STRs) were down by 3.6% on an organic, comparable trading day basis. Volumes continued to be affected by the 2005 competitive price reductions and market share gains by the import and craft beer segments. Miller Lite brand volumes declined marginally on an adjusted basis, whilst Miller’s key economy brand volumes declined by mid-single digit levels. In the worthmore sector, Miller achieved encouraging volume growth resulting from innovation in the Leinenkugel’s range and expanded distribution for our newly launched Peroni Nastro Azzurro brand.
Our Africa and Asia business delivered organic growth of over 20% in lager volumes. China recorded organic growth in excess of 25%, with all regions contributing to this good performance. During this six month period, CRSnow became China’s largest brewer and its national brand Snow, the country’s largest beer brand, achieved strong growth. In Africa (excluding Zimbabwe) lager volumes grew by 6%, with volumes in Tanzania advancing in mid-single digits. Strong gains were achieved in Mozambique and Uganda, outweighing the volume decline in Botswana resulting from the prior years’ local currency devaluations.
In South Africa, lager volumes were ahead by almost 1% following strong growth in the prior year. Sales mix improved as a result of good growth in our portfolio of premium brands. Soft drink volumes increased by some 1%, following growth of 10% in the comparable prior year period during which weather conditions were particularly favourable.”
Notes to editors:
SABMiller plc is one of the world’s largest brewers with brewing interests or distribution agreements in over 60 countries across five continents. The group’s brands include premium international beers such as Miller Genuine Draft, Peroni Nastro Azzurro and Pilsner Urquell, as well as an exceptional range of market leading local brands. Outside the USA, SABMiller plc is also one of the largest bottlers of Coca-Cola products in the world.
In the year ended 31 March 2006, the group reported US$15,307 million in revenue and profit before tax of $2,453 million. SABMiller plc is listed on the London and Johannesburg stock exchanges.
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