SABMiller earnings lift 3%
By fstimes On 23 Nov, 2013 At 10:27 AM | Categorized As Business | With 0 Comments

sabSABMiller has reported a rise in profits for the first half of its financial year, as strength in Africa helped offset declining beer sales in Europe and North America.

Earnings before interest, taxes, depreciation and amortisation rose seven percent to $3.27 billion in the six months ended September 30.

That was ahead of analysts’ average estimate of $3.22 billion, according to a company-supplied consensus.

Lager sales by volume rose one percent.

Gains of nine percent in Africa, four percent in Asia Pacific and one percent in Latin America were tempered by declines of four in Europe and three in North America.

“Looking forward to the second half of the year, we expect trading conditions to remain broadly unchanged, with volume growth continuing to be driven by emerging markets,” chief executive officer Alan Clark told reporters.

Shares of the company, which had fallen nearly 10 percent in the past six months, were up 0.6 percent at 3255.5 pence at 10:30 yesterday.

Earnings on a per-share basis were $1.20, slightly below analysts’ average estimate of $1.21.

“Europe is trading below our expectations,” chief financial officer Jamie Wilson said, noting that the region has been tough for a number of quarters.

“We see the economies there continuing to perform sluggishly, so that is not a surprise to us.”

Net producer revenue, which excludes excise and similar taxes, was $13.79 billion, in line with estimates.

Meanwhile, South African hotels and casino operator Tsogo Sun reported a 20 percent rise in first-half profit yesterday, helped by an acquisition that offset the slow revenue from gambling and leisure travel.

Tsogo Sun, in which SABMiller and Hosken Consolidated Investments each have a nearly 40 percent stake, said headline EPS totalled 81.3 cents in the six months to end-September compared with 68 cents a year earlier.

Tsogo Sun and smaller rival Sun International hotels are struggling to fill up rooms as the government and corporates spend guardedly due to weak economic growth prospects while high household debt levels have made consumers wary of gambling and leisure travel.

In a bid to offset slowing growth at home, Tsogo Sun paid R700 million earlier this year to buy a hotel in Nigeria and a further R300 million to expand its Mozambican hotel.

Growth expectations for the local economy was cut this year to 2.1 percent from 2.7 percent as labour strikes, slower consumer spending and power constraints weigh on the continent’s biggest economy. – Reuters.

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