Advertisement
Crafts and imports rose 5 percent in the period ending Sept. 30 compared to the previous year, said SABMiller, which operates the MillerCoors joint venture with Molson Coors Brewing Co.
But the brewer said lime-flavored Miller Chill posted a significant drop due to what SABMiller called “aggressive competition” in the segment — which now has Anheuser-Busch Cos. Inc.’s Bud Light Lime.
London-based SABMiller, also known for brands Grolsch and Peroni Nastro Azzurro, made the announcement while releasing its own results for the first half of its fiscal year on Tuesday. It said worldwide beer sales increased slightly, but the company wasn’t so sure about the rest of the year given the worldwide economic uncertainty.
“Deteriorating global economic conditions, weakening consumer demand and volatile exchange rates make the prospects for the rest of the financial year increasingly uncertain,” the company said in a news release.
Worldwide beer sales rose 1 percent in the quarter and 3 percent in the first half of the year, as rising demand from new markets helped offset slowing demand elsewhere in key markets like Europe. The company does not report monetary figures or profit in its half-year trading update.
The company said higher input costs were offset by price increases, and the company saw a a 5 percent jump in revenue per hectoliter.
In the U.S., sales to retailers rose .7 percent in the quarter, rebounding from a 2 percent drop in the first quarter of the year.
Coors Light’s volumes rose 6.8 percent while Miller Lite’s sales fell 3.6 percent. Coors Banquet and Miller High Life continued to generate good growth, the company said, while Keystone Light saw double digit gains.
Coors Light is the fastest growing light beer in the segment and it’s clear that the joint venture, which started in July, is helping stoke that brand’s growth, said Benj Steinman, editor of Beer Marketer’s Insights, a trade publication.
He said it was easier to build momentum on a growing brand rather than a declining one like Miller Lite.
The slip in that brand’s sales was one of its biggest dropoffs in recent years, he said, more than doubling the decline from the first quarter. It could signal there were some issues as the two companies merged their operations.
“They have a very complex portfolio and it’s hard to get it all right, particularly right out of the gate and that’s what we’re seeing,” he said.
With all these numbers, it’s clear Anheuser-Busch won the summer with its 3.6 percent increase in sales, much of it on momentum from Bud Light Lime, Steinman said. That beer, released this spring, is a direct competitor to Miller Chill, which was released last year.
MillerCoors didn’t immediately return a request seeking comment on its quarterly sales.
SABMiller said it saw demand drop off in key markets, like Europe, which saw 2 percent volume growth in the first half of the year, down from 12 percent growth in the prior year. Romania, a new market for the company, led growth with a 24 percent rise in volumes, while Poland posted a 4 percent gain. Russia’s volumes were down 4 percent, on sustained high inflation, and the Czech Republic was down 5 percent, though SABMiller said business has been improving there with new marketing initiatives.
Other new markets such as Peru also Ecuador helped the increase in beer sales. Overall in Latin America, lager volumes grew 3 percent. Columbia’s volumes fell 3 percent but Peru’s rose 10 percent and Ecuador rose 14 percent.
South Africa, a big market for SABMiller, posted a 1 percent drop in lager volumes for the first half of the year, though sales were stronger in the second quarter. The company said softer consumer demand was affecting business, as was ongoing cost inflation and currency weakness.
