SABMiller Finds New Markets

January 27, 2012, 9:15 am

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Brewing giant SABMiller is putting faith in emerging markets as its traditional markets in northern Europe begin to falter during the economic crisis.

A trading statement shows that the short-fall in Europe and the US is being tempered by increased sales in the emerging sectors.

SABMiller, which recently bought the iconic Australian Foster's and whose brands include Grolsch, Peroni and Strongbow, reveals in its latest annual report that Europe accounts for 20pc of group lager volumes, and North America 19pc. Asia is 24pc of volumes, Latin America 18pc, South Africa 12pc and Africa 7pc.

Third-quarter volume growth met analysts' estimates, rising 3pc, buoyed by strength in Africa and Asia. Soft-drink volumes grew 6pc.

European sales were disappointing, falling 2pc because of "intense competition" and "fragile" economic conditions. At its MillerCoors joint venture in North America, volumes dropped by 3.3pc. A 3pc fall was predicted.

However, in Latin America lager volumes continued to show robust growth with volumes up 8pc.

Asian volumes were 7pc higher and African volumes jumped 11pc. Volumes in China grew 5pc, despite a strong comparative period.

Africa shows strong volume growth as the middle classes continue to grow. Recent analysis by broker Bernstein indicates that Africans currently drink nine litres of beer per person each year. This compares with the average consumption in North America of 70 litres per person and 50 litres in Central and South America.

SABMiller recently unveiled a management shake-up at its African operations, as part of its strategic alliance agreement with French brewer Castel.

"The changes involve the combination of the operational management of the Castel and SABMiller businesses in Nigeria and Angola, with the Nigerian businesses being managed in future by SABMiller, and the Angolan businesses being managed by Castel," SABMiller said.

Volumes for Foster's are not included in the third-quarter data - from now on they will be included in its Asia/Pacific region. However, SABMiller revealed that volumes for the quarter ending December were 6pc below the same period in the prior year.