SABMiller Q4 sales fall short of estimates

17 April 2009

SABMiller Plc, the second-largest brewery in the world reported lower than expected sales growth on a slump in emerging markets and a surge in commodity costs.

The London-based company said in a statement that excluding acquisitions, the amount of beer it sold in the last 12 months from a year earlier remained virtually unchanged. This fell short of the 1 per cent median estimates made by eight analysts surveyed by a leading media company.

The company has posted a 2 per cent increase in the period's first nine months and a 7 per cent rise a year earlier.

Sales in the fourth-quarter fell 1 per cent on declining consumer demand in most markets, the company said. SABMiller  makes the largest proportion of profits from emerging markets from the four largest brewers. SABMiller had raised prices in response to the impact of the stronger dollar as currencies such as the Russian Rouble and Colombian peso tumbled against the dollar.

Market analysts point to the lackluster performance in the fourth quarter. According to them the company clearly underperformed in the fourth quarter, particularly in South Africa.

Beer volumes in South Africa declined 2 per cent with a weakening last quarter trend, the company said. Shipments suffered as regulations prohibiting the sale of alcohol in Western Cape province's 30,000 shebeens, or unlicensed bars came into effect in January. Shebeens in Western Cape, South Africa's largest province, cater to about 5 million customers.