Brewer SABMiller reports rising annual profits

LONDON: Britain-based brewer SABMiller said on Thursday that annual net profits grew on the back of rising prices for its products which include Grolsch, Peroni Nastro Azzurro and Pilsner Urquell beers.

Net earnings rose by two percent to 1.91 billion dollars (2.37 billion euros) in the 12 months to March 31, compared with 1.88 billion dollars in the previous financial year, SABMiller said in a results statement

Revenues increased by four percent to 26.35 billion dollars during the 2009/2010 fiscal year, aided by higher prices, but volumes flattened.

The group, which also makes Miller Lite and Coors Light beers, said it performed well in a difficult environment.

"In a year characterised by very difficult trading conditions, the business has delivered another strong performance, capitalising on our excellent market positions and unique portfolios of leading local and international brands," said Chairman Meyer Kahn.

"Profits and cash flow have improved significantly, and at the same time, we have continued to support current and future growth opportunities, particularly in our developing market businesses."

Turning to the outlook, SABMiller highlighted promising improvements in emerging markets but predicted a consumer spending recovery was not expected until later in the current 2010/2011 financial year.

"Although the economic environment began to improve for some of our emerging market businesses in the latter part of the financial year under review, a broader recovery in consumer spending is not expected before the second half of the current financial year," said Chief Executive Graham Mackay.

"Price increases will be taken selectively, predominantly in the second half, and we expect raw material input costs for the year to be level with, or marginally down on, the prior year.

"We will continue to implement our cost productivity initiatives while increasing investment in our brands."

SABMiller, founded in Johannesburg in 1895, dominates the South African beer market with brands such as Castle Lager. It was known formerly as South African Breweries before it snapped up the Miller brand in 2002.

The brewer has rapidly expanded its global empire in recent years, purchasing assets in Asia, Central and South America and Europe.

SABMiller, which bought Dutch peer Royal Grolsch in 2007, is also one of the largest bottlers of Coca-Cola products.