SABMiller's Q1 sales performance by region - Focus

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Earlier today, SABMiller released a trading update, with sales in the three months to the end of June rising by 2% year-on-year. Here, just-drinks looks at the company's top-line performance by region.
All results are on an organic basis.

SABMiller issued a Q1 trading update earlier today

SABMiller issued a Q1 trading update earlier today

  • Latin America - Q1 sales +5%, volumes +1%

Sales in Colombia rose by 7% thanks in part to price increases that took effect in the second half of the previous fiscal year. Volumes were up by 4%, despite a national transport strike late in the quarter. Mainstream brand Poker and upper mainstream brand Aguila Light performed well, while local premium brand Club Colombia leapt by double digits. Soft drinks volumes in the country fell by 20% as malt beverage Pony Malta continued to struggle with "unfounded social media rumour in October". Peru posted a sales lift of 6% on a 3% volumes increase. Lager volumes in the country were up by 4% thanks to the roll-out of "affordable" bulk packs for the Cristal mainstream brand. Ecuador, meanwhile, struggled in the period, following earthquakes in April, a 66% excise increase in May and a VAT rise in June. General volumes fell by 19%, while soft drinks volumes, in particular, were down by 32%.

  • Africa - Q1 sales +6, volumes flat

Some African markets are suffering from "challenging trading and macroeconomic conditions and consumer pricing effects", SAB said today. Consequently, local currencies are the subject of "ongoing material depreciation". Lager volumes in Africa dipped by 1%, with soft drinks rising by 3%. Volumes of other alcoholic beverages fell by 11%. South Africa grew sales by 6% despite a weak economy. Volumes in the country were up by 2%, with lager inching up by 1% and soft drinks increasing by 6%. Sales in Nigeria leapt by 36% thanks to healthy volume rises. Tanzania, however, saw sales fall by 13% as "aggressive pricing by competitors" had an effect. SAB's subsidiaries across the rest of Africa posted a 9% sales lift, with volumes struggling with a slowdown in consumer demand. Castel, with whom SAB operates in several markets in the continent, has scaled back its Angola operations due to "weak economic fundamentals". The company saw sales inch up by 1%.

  • Asia Pacific - Q1 sales -2%, volumes -3%

Asia Pacific was a tale of two markets for SAB. Sales in Australia increased by 7% as the company focused its efforts on its premium and contemporary brands. The mainstream Victoria Bitter and Carlton Draught brands remain in decline in the country. Over in China, meanwhile, sales and volumes both slipped by 4%. The group, which jointly owns the market-leading Snow beer brand in the country, continues to battle with "challenging industry and macroeconomic conditions".

  • Europe - Q1 sales +6%, volumes +8%

Europe was the star performer of the quarter for SAB, with sales rising in most markets. Czech and Slovakia were up by 12%, although a benefit was felt from a "softer prior-year quarter". The Kozel and Pilsner Urquell brands did well enough to offset a subdued performance from Gambrinus in the markets. Poland saw sales lift by 14% on a 22% jump in volumes, thanks in part to a relisting of SAB brands in "a key account". A revised pricing strategy by SAB resulted in lower-mainstream Zubr outpacing the growth of premium Lech and upper-mainstream Tyskie. The UK posted a 13% sales rise as Peroni Nastro Azzuro picked up in the on-premise and benefited from pack innovations in the off-premise. Sales were up across all of SAB's subsidiaries across Europe, particularly in Romania and Hungary.

  • North America - Q1 sales -3%, volumes -4%

SAB's MillerCoors North American JV, which will be sold to Molson Coors once Anheuser-Busch InBev completes its SAB takeover, posted a 4% fall in domestic sales to wholesalers, while US domestic sales to retailers (STRs) were down 2%. STRs for the premium light stable slipped slightly, with Miller Lite in line with Q1 last year and Coors Light down by low single-digits. The above-premium segment for MillerCoors saw volumes dip by low single-digits, although Henry's Hard Soda grew. The below-premium portfolio was down by mid single-digits.

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