SAB’s lager volume sales rose 3% to 229m hectoliters during the year, while soft drinks volumes were up 7% to 49m hectoliters.
But despite Latin American EBITA up 12% and Asia Pacific up 30%, European EBITA fell 9%, due to lower volumes, adverse mix and increased raw material costs; US EBITA grew only 2%.
‘Crucial premium light sector’
Asked whether the industry, and MillerCoors (SAB's JV with Molson Coors) in particular, could turn around the “crucial premium light segment”, Mackay acknowledged that big mainstream brands suffered during the recession, and that SAB Miller and rival AB InBev were addressing the problem.
“In our case we have Miller Lite punch top can, there’s the momentum behind the Coors Light aluminium pint [pictured] and various other innovations,” he said.
SAB Miller had also launched Miller 64, but in a more general sense, the company was expanding its portfolio and investing in the “above premium”space via Tenth and Blake Beer Company, recently created by SAB to tap the US craft beer phenomenon.
Mackay mentioned MillerCoors' purchase of a minority stake in craft brewer Terrapin Beer Company last year, as well as other innovations including Crispin Cider, Coco Breve (beer with coconut water) Redd’s, and Belgian beer St.Stefanus.
Although it didn’t anticipate a 100% hit rate on innovations, Mackay said that SAB was hopeful that a good number of them would find a long-term niche and provide long-term growth.
Spirits turn against beer
Discussing the fact that spirits were outperforming beer in the US and to some extent in Western Europe, Mackay said that beer was an “aspirational products”in developing markets – where international spirits were out of reach for local consumers – and SAB could tap this demand.
The resurgence of spirits in established markets meant SAB was pursuing innovation at the top end, Mackay added, as well as “more exciting brands, more differentiated authentic brands, be they craft or global premium brands, be they normal beers, or different flavoured beers”.
Meyer Kahn, SAB Miller chairman said: “We continued to expand our global footprint with the acquisition of Foster’s, the merger of our Russian and Ukrainian businesses with Anadolu Efes in exchange for a stake in the enlarged business, and the further development of our alliance with Castel.”
It was early days for SAB Miller’s 2011 acquisitions of Foster’s and Efes, Mackay said, with SAB looking to strip out costs and “fundamentally restructure” the latter Russian/Ukrainian business, while Australian sentiment at consumer level was uncertain and this was affecting Foster's.
