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Interim results F13: Strong revenue and earnings growth

22 November 2012

SABMiller plc, one of the world's leading brewers with operations and distribution agreements across six continents, reports its interim (unaudited) results for the six months to 30 September 2012.

Operational Highlights

1 Growth is shown on an organic, constant currency basis.
2 As defined in the financial definitions section. See also note 10b.


Financial highlights 6 months to Sept
6 months
to Sept
% change 12 months to March
  1. Group revenue includes the attributable share of associates' and joint ventures' revenue of US$6,106 million (2011: US$5,149 million).
  2. Revenue excludes the attributable share of associates' and joint ventures' revenue.
  3. Note 2 provides a reconciliation of operating profit to EBITA which is defined as operating profit before exceptional items and amortisation of intangible assets (excluding software) but includes the group's share of associates' and joint ventures' operating profit, on a similar basis. EBITA is used throughout this interim announcement.
  4. Adjusted profit before tax comprises EBITA less adjusted net finance costs of US$391 million (2011: US$229 million) and share of associates' and joint ventures' net finance costs of US$23 million (2011: US$15 million).
  5. Profit before tax includes exceptional charges of US$127 million (2011: US$191 million). Exceptional items are explained in note 3.
  6. A reconciliation of adjusted earnings to the statutory measure of profit attributable to owners of the parent is provided in note 5.
Group revenuea 17,476 15,688 11 31,388
Revenueb 11,370 10,539 8 21,760
EBITAc 3,173 2,701 17 5,634
Adjusted profit before taxd 2,759 2,457 12 5,062
Profit before taxe 2,279 2,041 12 5,603
Profit attributable to owners of the parent 1,590 1,382 15 4,221
Adjusted earningsf 1,875 1,633 15 3,400
Adjusted earnings per share        
- US cents 118.1 103.3 14 214.8
- UK pence 74.7 64.0 17 134.4
- SA cents 967.5 731.1 32 1,607.0
Basic earnings per share (US cents) 100.1 87.4 15 266.6
Interim dividend per share (US cents) 24.0 21.5 12  
Free cash flow 1,684 1,479 14 3,048

Executive Chairman's review

Graham Mackay, Executive Chairman of SABMiller, said:

“Broad-based revenue and profit growth in the first half reflects the continued success of our approach to the development of our brands, product portfolios, distribution and sales effectiveness. We have strengthened our local flagship brands, complemented by product innovation across a wide range of styles and prices. Margins have risen modestly despite higher input costs, as a result of our cost reduction and procurement initiatives supplemented by a positive contribution from the acquisitions and business combinations concluded in the second half of last year.”


Segmental EBITA performance Sept
2012 EBITA
Organic, constant
Latin America 920 15 14
Europe 516 (10) (5)
North America 479 6 6
Africa 355 8 19
Asia Pacific 506 265 10
South Africa: Beverages 426 (4) 11
South Africa: Hotels and Gaming 65 (2) 12
Corporate (94) - -
Group 3,173 17 9


Business review

The group has delivered strong revenue and profit growth during the period, with underlying volumes, aggregate pricing and mix all trending positively and contributing to margin development. We grew volumes and revenues across most regions despite a moderation of growth in some emerging markets. Development of brands, product ranges and the route to market continued across the breadth of our portfolio supported by further improved operating processes. The acquisition of Foster's in particular has contributed significantly.

Total beverage volumes were 4% ahead of the prior period on an organic basis with lager volumes up 4%, soft drinks volumes up 6% and other alcoholic beverages up 12%. This volume growth, selective price increases and improved brand mix in most regions led to group revenue growth of 8% on an organic, constant currency basis, with group revenue per hl up 3% on the same basis. Reported group revenue, which includes business combinations, was up 11%. Currency movements had an adverse impact of six percentage points on group revenue growth principally due to the weakening of the South African rand and Central European currencies.

EBITA of US$3,173 million represented growth of 17%, including the contribution of Foster's and other business combinations but also the impact of currency weakness. EBITA grew by 9% on an organic, constant currency basis reflecting a combination of volume growth and rising group revenue per hl combined with some cost savings and efficiencies. On an organic, constant currency basis the EBITA margin rose 30 basis points (bps). Raw material input costs rose, as expected, by mid-single digits (on a constant currency, per hl basis) largely as a result of higher cereal costs partly offset by procurement and other savings. Fixed costs increased with salary inflation and further expenditure on sales and systems capabilities, partly offset by on-going cost efficiency initiatives. Investment in brand development continued, with related marketing costs rising slightly behind the increase in revenue. EBITA margins also benefited from acquisitions and business combinations, particularly Foster's, and the reported EBITA margin for the group expanded by 100 bps to 18.2%.

Adjusted earnings growth of 15% reflects higher EBITA, boosted by the acquisition of Foster's, and a reduction in the effective tax rate to 27.5%, partly offset by increased finance costs driven by Foster's-related debt. Adjusted earnings per share were up 14% to 118.1 US cents.

Despite the adverse currency movements, free cash flow increased by US$205 million compared with the prior period, to US$1,684 million. Adjusted EBITDA, which includes dividends from MillerCoors but excludes the cash impact of exceptional items, increased by US$342 million (12%) with underlying growth enhanced by the contribution from Foster's. Capital expenditure, including that on intangible assets, of US$655 million was US$105 million lower than in the prior period. We have continued to invest, particularly in Africa, in order to address capacity constraints and to support growth. New brewing capacity was commissioned in South Sudan and Nigeria during the period and new capacity in Ghana, Tanzania, Peru, Uganda and Zambia is currently under construction. Working capital generated a net cash outflow during the period of US$219 million driven by the timing of payments to creditors, increased inventory value particularly in Africa and Latin America, utilisation of provisions in Australia and higher receivables in Europe due to growth in the modern trade channel. Net interest paid increased by US$190 million over the prior period reflecting increased debt primarily reflecting the acquisition of Foster's, but the timing of a one off tax cash inflow in Australia more than offset this.

The group's gearing ratio as at 30 September 2012 reduced to 65.0% from 68.6% at 31 March 2012 (as restated). Net debt was reduced by US$750 million to US$17,112 million. An interim dividend of 24.0 US cents per share, up 2.5 cents (12%) from the prior year's interim dividend, will be paid to shareholders on 14 December 2012.


We have recently seen moderation of economic growth in some countries, but the potential of the principal emerging markets in which we operate remains strong. The positive impact from acquisitions and business combinations seen in the first half will reduce as we cycle their completion in the latter part of the year. Performance will continue to reflect progress in the development of our brands, product portfolios, distribution and sales effectiveness. We expect input cost pressures to continue at a level similar to that of the first half of the year, and we will selectively raise prices where market conditions permit. We will continue to invest, in brand development, innovation, systems and capability to sustain growth, as well as to implement our planned capital programmes.

1 Australia pro forma volumes are based on volume information for the period from 1 April 2011 to 30 September 2011 using SABMiller's definition of volumes and include 100% of the volumes for Pacific Beverages, our joint venture in Australia until January 2012.

Download the full Interim F12 announcement PDF 0.47Mb

  SABMiller plc Tel: +44 20 7659 0100
Catherine May Director of Corporate Affairs Tel: +44 20 7927 4709
Gary Leibowitz Senior Vice President, Investor Relations Tel: +44 20 7659 0119
Richard Farnsworth Business Media Relations Manager Tel: +44 20 7659 0188

A live audio webcast of a presentation by Executive Chairman, Graham Mackay, Chief Operating Officer, Alan Clark, and Chief Financial Officer, Jamie Wilson to the investment community will begin at 9.30am (GMT) on 22 November 2012. To register for the webcast, download the slide presentation, view management video interviews and download photography and b-roll, visit our online Results Centre at

To monitor Twitter bulletins throughout the day follow or #sabmillerresults.

Copies of the press release and detailed Interim Announcement are available from the Company Secretary at the Registered Office, or from 2 Jan Smuts Avenue, Johannesburg, South Africa.

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