SABMiller sales growth held back by subdued China

LONDON Tue Jan 22, 2013 3:14am EST

LONDON (Reuters) - China's coldest winter in 28 years hit lager sales at SABMiller (SAB.L), holding back volume growth in the third quarter for the global brewer.

The London-based company, which operates joint venture CR Snow in China, on Tuesday said volumes declined 3 percent in China in the three months to end-December

Group organic lager volumes grew 2 percent, but without the Chinese decline the figure would have been growth of 3 percent, said a company spokesman. However, although significant in volume terms China accounted for only 2 percent of the company's earnings last year.

Financial performance was in line with its expectations, SAB said, as revenues rose 17 percent compared to a year ago on a reported basis, or 8 percent in constant currency terms.

The brewer of Colombia's Aguila and Peru's Cusquena said lager volumes rose 6 percent in its key Latin American region.

SAB has leading positions in the smaller Latin American nations such as Colombia and Peru, with much of the larger markets of Brazil and Mexico carved up by the company's two biggest rivals, AB InBev (ABI.BR) and Heineken (HEIN.AS).

The company, which also makes Miller Lite, Grolsch and Peroni beers, said depressed consumer confidence continued to weigh on demand in Europe, where lager volumes rose 1 percent.

The world's second biggest brewer, which has expanded rapidly over the past two decades from its South African roots (SABJ.J), earns around 70 percent of its profit from fast-growing emerging markets, which helps insulate it from tough mature markets where hard-pressed consumers are economizing at the bar and drinking less at home.

Africa continued to show strong growth, up 4 percent on an organic basis. The brewer of Castle lager said improved distribution had led to lager growth of 10 percent in Zambia.

SABMiller shares, which crossed the 3,000 pence per share mark for the first time ever this month, opened flat on Tuesday at 2,960 pence.

(Reporting by Rosalba O'Brien; editing by Rhys Jones)

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