Annual Report - SABMiller

SABMiller plc Annual Report 2010 Operations review 31In Angola, in a very challenging year, soft drinks volumesended 5% below the prior year, while lager volumesgrew 5%. After years of strong economic growth, Angolaexperienced negative GDP growth following a significantdrop in oil revenue. During the year, the kwanza was delinkedfrom the US dollar resulting in a 15% depreciationand the imposition of severe currency restrictions. Thesefactors negatively impacted consumer spending. Capacityconstraints, exacerbated by difficult logistics, hamperedproduction while the cost of imported raw materials wasadversely affected by the currency depreciation. A newtwo million hectolitre soft drinks plant was commissionedin January 2010 and the new brewery in Luanda wascommissioned in April 2010.In Botswana, the sale of alcoholic products continued tobe adversely affected by difficult economic conditions, thesocial levy introduced in November 2008 and restrictedtrading and drinking hours. Our lager volumes ended theyear 35% below the prior year. Soft drinks volumes grewby 9% driven by increased returnable bottle sales,enhanced marketing and improved trade execution.Castel delivered increased profits with lager volumesgrowing 11% supported by new capacity in Angola andgood growth in Cameroon, Ethiopia and the Republic ofCongo. Soft drinks volumes also grew 11% with goodgrowth in Algeria, Tunisia and Cameroon.Asia: EBITA level on an organic,constant currency basis asstrong China growth is offsetby constraints in IndiaAsiaFinancial summary 2010 2009 %Group revenue (includingshare of associates andjoint ventures) (US$m) 1,741 1,565 11EBITA (US$m) 71 80 (12)EBITA margin (%) 4.1 5.1Sales volumes (hl 000)Lager 46,279 41,714 11Lager (organic) 44,815 41,714 7Key focus areas■ Further build market leadership in Chinaand enhance profitability■ Continue to drive Snow, the largest beerbrand in China■ Pursue market liberalisation in India toachieve a reasonable trading environmentfor the beer industry■ Develop our operations in Vietnam and Australiaas well as our broader regional presenceAsia’s lager volumes grew 7% on an organic basis,with good growth in China, Australia and Vietnam partlyoffset by volume decline in India due to regulatory issues.Full-year EBITA was level on an organic, constant currencybasis with good underlying growth in China offset bydifficult trading conditions in India. Reported EBITA,which includes initial losses in recent Chinese start-upsand acquisitions, declined 12%.In China, lager volumes grew 10% on an organic basisand 13% on a reported basis despite a slowdown in growthover the last quarter of the year. Additional capacity ofsome 20 million hectolitres was added during the yearincluding the acquisition of three new breweries and thecommissioning of four greenfield breweries across bothexisting and new markets. Marketing efforts remainedfocused on the Snow brand, which is now approaching90% of volumes, particularly behind the Snow Draft andBrave the World variants in the fast-growing premiumsegment. CR Snow’s market share continued to growand is estimated to exceed 20%.Overview Business reviewGovernance Financial statements Shareholder information