JOHANNESBURG SABMiller, Africa's biggest brewer, which also owns a 37 per cent stake in Zimbabwes Delta Beverages, has forecast a huge growth in Africa. (Pictured: Castle beer, one of SABMillers top sellers)
The brewer, which also second largest in the world and bottles for Coca-cola in over 20 African countries, including Zimbabwe, said that after spending US$1,5-billion over the last three to four years in the continent, it is now eyeing growth in new markets like Nigeria, southern Sudan and Ethiopia.
A strong economic and population growth is driving Africa’s thirst for beer, and our business unit, excluding South Africa, earns 12 per cent of group profits and is our fastest growing beer market along with Asia, with underlying beer volumes growing 12 per cent in the last quarter of 2010, said the companys managing director, Mark Bowman recently.
“Generally, Africa has good GDP growth, better governance and strong population growth, all conditions to do well. GDP in 2010-2013 for sub-Saharan Africa is set to grow by nearly five per cent a year compared to three per cent for the world, while population growth for Africa’s 1-billion people and we project to grow at over two per cent a year or around twice that of other areas like Asia.
The London-based brewer added that is was upgrading its three-four year medium term target for revenue per hectolitre of beer to see three-five per cent annual growth in dollar terms from one-three per cent previously, and earnings before interest, tax and amortisation (EBITA) margins to rise 0,8 to 1,0 percentage points a year after a previous flat target.
The group is holding its African beer volume growth target to see a high single-digit percentage rise per year, with the region’s beer consumption of seven litres per person a year well behind Europe’s 60 litres. All these targets start in the group’s next financial year to March 2012.
After big brewery investments in its top markets such as Angola and Tanzania, the group has recently moved into Nigeria, southern Sudan, the water market of Ethiopia and started accounting for its 37 percent-owned Zimbabwe unit as economic and political conditions start to slowly improve.
SABMiller has primary brewing and beverage operations in 34 countries and is the number one brewer in terms of market share in most of these countries. In 16 of these countries it has management control, while in others it has a strategic alliance with Castle and a minority shareholding in Kenya and Zimbabwe.
Post published in: Economy