History
SABMiller plc has its origins in South Africa where the original brewing operations of the group was founded in 1895, known as “Castle Brewing”. Castle Lager was the first brand launched from a newly-commissioned lager brewery with a yearly capacity of 50,000 barrels. It also participated in industry consolidation, including acquiring the Ohlsson's and Chandlers Union Breweries in 1956, after which the company became known as “The South African Breweries” and the beer interests of the Rembrandt group during 1979. In addition, it obtained the franchise for bottling and distributing Coca-Cola products in 1976, separately managed by the Amalgamated Beverages Industries (“ABI”). The South African lager and sparkling beverage businesses are now integrated following the 2004 purchase of the balance of ABI shares that SAB did not already own, and together are known as the South Africa Beverages division of SABMiller, or locally, as the South African Breweries Limited (“SAB”).
Current business
SAB has consistently focused on growing lager and sparkling beverage volumes and delivering continuous improvement in product quality and operational efficiency. This growth and momentum is driven by the specific and tangible culture within the business of personal accountability, perfectionism and restlessness. The business constantly develops and implements a range of beer sales and marketing plans which, in combination with its strong relationships with its routes to market, has led to an ongoing rise in beer’s share of alcohol by volume (“ABV), now some 60%. This market share momentum has been supported by the focus on premium volume growth in recent years. The extensive activation agenda in sales and distribution is replicated in sparkling beverages with the business harnessing its full portfolio of brands (in both the sparkling and still beverage categories), to drive sparkling beverage volume growth effectively.
Future strategy
Looking forward, the recent economic momentum in South Africa is expected to continue and will drive strong consumer spending and provide a solid platform for the future growth of the businesses.
The key focus areas for SAB include continuing to provide a balanced, strong and differentiated portfolio of brands in both the lager and sparkling beverage businesses. For lager the emphasis will be in sustaining the current momentum in premium beer volume growth, and strengthening mainstream beer offerings with respect to both brands and packaging, and building a platform of strong still beverages to complement the strong position in sparkling beverages. As a result, the business will increasingly look to innovation for further sources of growth.
Other focus areas include developing its routes to market, and more specifically improving its market penetration. The business has embarked upon an extensive program of growing its customer base through direct delivery to the informal on-premise points of sale (known locally as “Shebeens”). The outlets are participating in the process of formal licensing, initiated by the South African government, which is actively supported by the business as a result of its commitment to investing in the South African community. Licensing holds significant benefits for South African society in legitimising the sales of beer in the informal on-trade, thereby raising the image of the industry as a whole. It will also have a significant impact on formal job creation. Licensing also enables SAB to deliver directly to Shebeens as they become legitimised and this gives SAB greater control over its routes to market, including an existing sales service base of some 45,000, greater flexibility in brand and pack channel management, channel mark-up management and price compliance. There are also potential long term top-line benefits as Shebeen owners are motivated to re-invest in their businesses, driving greater consumption in the enhanced points of sale.
| Company/hub name |
The South African Breweries Ltd |
| Website: |
www.sabreweries.co.zawww.sablimited.co.za
www.abi.co.za
www.castlelager.co.za
www.brutalfruit.co.zawww.millertime.co.za
www.worldofbeer.co.zawww.sabcareers.co.za
www.sabkickstart.co.za
| |
| Year of investment |
1895 |
| EBITA (US$m) |
1,102 |
| |
|
| Total number of breweries |
7 |
| Areas where we have brewing operations |
Cape Town, Durban, Johannesburg (2), Polokwane, Port Elizabeth, Pretoria |
| Main brands |
Brutal Fruits, Carling Black Label, Castle Lager, Castle Lite, Castle Milk Stout, Hansa Pilsener, Miller Genuine Draft, Peroni Nastro Azzurro, Pilsner Urquell, Redd's, Sarita, Sterling Light Lager, Hansa Marzen Gold |
| Total lager beer brewing capacity (hl 000) |
31,400 |
| Total size of beer market (hl 000)* |
26,135 |
| Beer consumption per capita (litres) |
56.9 |
| |
|
| Total number of bottling plants (non-beer) |
7 |
| Total bottling capacity (hl 000) |
18 000 |
| |
|
| Total volumes sold (hl 000) |
42,529 |
| Lager beer (and malt beverages) |
26,543 |
| Main brands (non-alcoholic) |
Appletiser, Bibo, Bon Aqua, Coca-Cola, Coca-Cola Light, Coca-Cola Light with Lemon, D'Lightiser, Fanta, Five Alive, Grapetiser, Just Juice, Lemon Twist, Milo, Minute Maid, Nestea, Peartiser, Powerade, Powerplay, Schweppes, Sparletta, Sprite, Sprite Zero, Stoney Ginger Beer, TAB, Valpré, Vanilla Coke, Winne the Pooh Juice |
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|
| Carbonated soft drinks (CSDs) and other beverages (water and juices) (hls 000s) |
14,967 – Sparkling Drinks
1,019 – other beverages |
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|
| Average number of employees |
8,600** |
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|
| Updated January 2008 |
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*Plato Logic
** Figures provided by SAB Ltd, January 2008