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SABMiller Seen Delivering Robust Full-Year Results |
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Tuesday, 13 May 2008 |
LONDON: SABMiller Plc. is expected to report robust top-line sales when it reports full-year results on Thursday, with price increases and mix improvements offsetting higher input costs.
The Pilsner Urquell and Miller Lite brewer said last month that revenue grew some 16 percent, putting projected sales for the year at around $21.2 billion. Analysts' consensus is for adjusted pretax profits of $3.54 billion, compared to $3.15 billion last time.
In April, SABMiller said lager volumes grew 7 percent, though it noted a slowing organic growth trend as it ran up against tough comparatives from the previous year.
Poor weather conditions in North America and China, as well as Latin America and South Africa also conspired to reduce organic volume growth to just 1 percent in the fourth quarter. The brewer hopes to see faster growth return towards the end of the first quarter of the current year, as softer comparatives return.
In contrast to the outlook for improving organic volume growth, analysts expect margins to remain under pressure as input costs continue to build.
In a note to investors, Dresdner Kleinwort said it estimates the gross impact of increased input costs to have been in excess of $250 million for the year to end-March, leading to a 36 basis point decline in margins. In 2008/09 it expects the input cost headwinds to have risen to around $500 million.
SABMiller is also expected to give a progress report on the planned integration of its U.S. business with that of Molson Coors. The deal, which is still subject to regulatory clearance, is expected to close in mid-2008.
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