SABMiller saw H1 profits rise

SABMiller saw H1 profits rise

Today, SABMiller reported a 15% rise in first-half profits but warned of challenges ahead. Here just-drinks takes a closer look at the numbers:

Africa

The group's reported sales in the region, which now includes South Africa, were up 3% (10% organically) while EBITA also increased by 3% as a result of volumes growth, pricing and a focus on cost productivity, SABMiller said. Castle Lite led the premium performance and the company said it also grew strongly in the affordable segment. 

Latin America

YTD sales in the region grew by 4% on a reported basis (7% organically), while EBITA was up by 7%, SABMiller said. Sales were driven by price increases and brand mix, supported by a return to lager volume growth in the second quarter, with “strong” soft drinks volume growth continuing, the company said. Reported EBITA margin improved by 70 bps.

Asia Pacific

Reported sales were level (down 1% organically) while EBITA in the region declined by 17% as the inclusion of the Kingway results in China was offset by depreciation of currencies against the US dollar. In Australia and China, an organic volume decline had a “significant” impact on profitability, SABMiller said. In Australia, sales on a constant currency basis were 4% below the prior period. In China, organic, constant currency group sales growth of 1% was impacted by a 3% lager volume drop driven by poor weather during the summer peak months in the central provinces. Reported EBITA in China declined as a result. 

Europe

In the region, reported sales were up by 1% (up 3% organically), while EBITA was down by 2%. Lager volumes growth in Poland, the combined Czech Republic and Slovakia business and the UK was offset by declines in Romania, Italy and Anadolu Efes.

North America 

Reported sales were 2% higher than the prior period, with a decline in lager volumes offset by higher group sales per hectolitre. EBITA increased by 7% as a result of increased profitability in US JV MillerCoors. There was a positive sales mix from the introduction of new higher margin products such as the Redd’s franchise, Miller Fortune and Smith & Forge Hard Cider.