FDBusiness.com

SABMiller, the world’s second largest brewing company and one of the largest bottlers of Coca-Cola drinks, has reported net producer revenue (NPR) up 2% to $14.0 billion and flat EBITA of $3.28 billion, which was impacted by the depreciation of key currencies against the US dollar, for the six months to 30 September 2014. NPR comprises group revenue, including the group’s share of associates’ and joint ventures’ revenue, less excise and similar taxes.

Organic, constant currency group net producer revenue (NPR) rose 5%, as top line growth was powered by the group’s Africa and Latin America businesses, but impacted by weaker second quarter trading conditions in China and Australia. Group NPR per hectolitre was up 3% driven by pricing and premiumisation initiatives.

Total beverage volumes grew by 1% on an organic basis, with lager volumes down 1%. Organic soft drinks growth was 9%. Organic, constant currency EBITA growth of 3% and constant currency adjusted earnings per share growth of 5% were impacted by adverse currency exchange factors.

Alan Clark, chief executive of SABMiller.

Alan Clark, chief executive of SABMiller, comments: “We continued to grow earnings in the first half with challenging trading conditions mitigated by ongoing efficiencies. Group net producer revenue was driven by lager growth in Africa and Latin America and strong performance in our soft drinks businesses in Africa, Latin America and Europe. Lower lager sales in parts of Europe and Asia Pacific resulted in a small group EBITA margin decline during the half year. We are well-placed to capture future top line growth opportunities in both emerging and developed markets and are making good initial progress on our plan to realise US$500 million from operational efficiencies and cost savings.”

In Europe, EBITA was down by 2% and group NPR was up by 1%, both on a reported basis. On a constant currency basis, group NPR was 3% higher than the prior half year, reflecting soft drinks volume growth in Anadolu Efes and lager volumes level with the prior period, with a challenging second quarter affected by poor weather across much of the region during the summer months. Lager volume growth in Poland, the combined Czech Republic and Slovakia business and the UK was offset by declines in Romania, Italy and Anadolu Efes. Organic, constant currency EBITA was level with the prior period and reported EBITA margin declined by 60 bps, driven by lower volume in Italy and Romania, along with restructuring activities in Anadolu Efes.

Looking ahead at group level, Alan Clark says: “We anticipate that trading conditions will remain challenging but we expect to continue to grow volume and NPR. As part of our strategy we will continue to drive efficiency across our business and invest in the front line so we can win in local markets. Raw material unit input costs are expected to increase by low single digits in constant currency terms with some markets continuing to be impacted by foreign exchange movements on imported raw materials.”