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May be a few hours - daily breather after yesterdays 10% rise, but on the whole looking good for another few weeks. Hoping NO vote up in Scotland & then markets take off.
was on the money!!!
was on the money!!!!
Heineken dismisses £80 billion SAB mega-merger: SABMiller has sounded out the Owners of Heineken about an £82 billion mega-merger as the FTSE 100 drinks group attempts a pre-emptive move against a possible bid by Anheuser-Busch InBev.
time to be buying.
good to see the share price up after todays rns
starting to think this is going to start moving again ,,director buying again to
numis puts an add rating on SAB target 35.00
Goldman sachs upgraded SAB to conviction buy target £35.80
Positive Points: Adjusted earnings materialised at the upper end of analyst forecasts. For the group's Africa business, adjusted earnings (EBITA) grew by 15% (16% on an organic, constant currency basis) as a result of the increase in volumes, with good growth in Tanzania, Zambia, Nigeria and Ghana highlighted. Management noted previously that "following a challenging start to the year, trading conditions in Europe and North America saw a modest improvement in the second quarter." For its North American business, EBITA increased by 3% as a result of increased profitability at MillerCoors. For Latin America, adjusted earnings (EBITA) grew by 6% (10% on an organic, constant currency basis). Effective development and extension of its brand portfolios continued to drive an increased share of total alcohol consumption across the region. Growth in soft drinks was driven by pack innovations in Peru and Ecuador. A positive 1.7% improvement in reported profit (EBITA) margin was achieved through a combination of net producer revenue (NPR growth), cost reductions and the phasing of marketing spend. In China, adjusted earnings benefited from an increased focus on efficiencies and fixed cost containment along with higher group net producer revenue (NPR). The group acquired Australian brewer Foster's in December 2011. The board previously noted that its "business integration plan in Australia is currently ahead of schedule and showing positive early signs." The group's dividend policy continues to be progressive. The half year dividend per share was increased by 4% compared to the prior year.
Negative Points: The depreciation of key currencies against the US dollar will adversely impact reported results in the current financial year. For the group's European division, adjusted earnings (EBITA) declined by 1%. Reported (EBITA) margin declined by 1.9% due to the impact of adverse channel and brand mix in Poland. The group's Chief Executive previously noted that "our first quarter revenue growth was held back by unseasonably cold and wet conditions in many of our northern hemisphere markets, which negatively impacted beer consumption." US domestic sales to retailers (STRs) declined 3.2% for the half year, and by 1.9% in the second quarter. Raw material and input cost pressures remain a concern.
Financial Highlights: Group revenue marginally higher at $17.559 billion ($17.476 billion). Adjusted earnings (EBITDA) rose by 4% to $3.27 billion. Half year dividend increased by 4% to 25.0 US cents (24.0 US cents).
Half year results: The results materialised at the upper end of analyst forecasts, with growth in Africa helping to offset more difficult conditions in Europe and North America. The share price rose by over 2% in opening stockmarket trading. The Chief Executive noted that "we have continued to deliver on the potential of our businesses in both developed and developing markets, with revenue and margin improvements amid mixed trading conditions." Lager volume growth of 1% on an organic basis was reported, reflecting strong growth in Africa and South Africa, partially offset by declines in Europe and North America, although growth in sales of higher margin products helped to drive an improved profit (EBITA) margin in North America. Accompanying management outlook comments noted that "trading conditions are expected to remain broadly unchanged, with growth continuing to be driven by our developing markets. The depreciation of key currencies against the US dollar will adversely impact reported results in the current financial year.
Admittedly, the robust long-term growth profile of SAB Miller's emerging markets isn't really in doubt. The IMF believes that developing Asia, for instance, will see economic growth of 7 per cent in 2014 and that Africa's economy will grow nearly 6 per cent. But nearer-term pain is looking likely. SABMiller's shares trade on 19 times broker Numis' forecast earnings for end-March 2014, which is well ahead of shares in rival brewers such as Carlsberg (CARL) or Anheuser-Busch InBev (ABI) that trade on a less demanding 14-15 times forecast earnings. True, those players are more exposed to low growth developed markets. The shares own price-to-earnings-growth ratio, based on Bloomberg consensus 12-month forecasts, also looks high at 1.63 times, which is within a whisker of the five-year high of 1.66 and well above a five year average of 1.20. As growth stumbles at SABMiller, that premium rating could prove hard to sustain. A prospective yield of around 2 per cent, while in line for its peer group, doesn't set the heart racing as always dyor gl
SABMiller's more developed markets are unlikely to compensate for that, either. With July's trading update, management reported that "unseasonably cold and wet weather and continued weak consumer sentiment" had driven organic revenue down by 1 per cent in Europe. Overall, European lager volumes fell 7 per cent with an especially weak performance in Poland and the Czech Republic - volumes there slumped by 14 per cent and 11 per cent, respectively. While, in North America, a challenging environment and "significantly cooler weather" helped drive revenues from its MillerCoor's operation down 3 per cent in the quarter. But there's no denying SABMiller's market dominance. It's the number one brewer in most of its African markets, for instance, and boasts a 90 per cent slice of South Africa's market. It dominates Latin America, too - from the seven Latin American markets in which it operates, it has market shares of above 90 per cent in five of them. It also has a 29 per cent slice of the US beer market, 21 per cent of China's, 23 per cent of India's and 45 per cent of Australia's. That position in Australia was generated on the back of 2011's $A10.5bn (£6.2bn) acquisition of Foster's - a deal that's expected to deliver A$180m a year in cost synergies by March 2016. SABMiller also has primary brewing operating in eight European countries and, for most of these, it's either the number one or number two player. It boasts some impressive global brands, too - including such popular offerings as Carling Black Label, Coors Light, Grolsch, Pilsner Urquell and Foster's.
It's conventional wisdom these days that companies that have emerging markets exposure will grow faster than those that don't. But unexpectedly downbeat news from personal products group Unilever (ULVR) last month has challenged that. Driven by currency weakness, it revealed a "weakening in the market growth of many emerging countries". That has helped push Unilever's shares down heavily in the past few weeks and it's a backdrop that looks highly relevant for brewing giant, SABMiller (SAB) - which generates about three-quarters of its profits in emerging regions. Its shares have also fallen in recent weeks, but they remain highly rated when compared to those of its rivals and its own historic rating - suggesting that more share price downside could be on the cards. True, SABMiller's most recent trading update in July reported solid first-quarter growth in most of its emerging markets. For instance, in the three months to end-June, organic revenues on a constant currency basis grew 10 per cent in Africa (outside South Africa), 5 per cent in South Africa, and 6 per cent in Latin America. Although performance in the Asia Pacific region was weak - organic revenue fell 2 per cent. Moreover, management admitted to analysts last month that currency weakness in emerging markets - precisely Unilever's problem - will drag on 2014's expected earnings. That has led broker Numis Securities to trim its end-March 2014 earnings estimate by around 3 per cent.
North America remained challenging and the plan is to "evolve" the portfolio towards premium beverages such as Third Shift Amber Lager and Leinenkugel's Summer Shandy. Revenues declined 2.0% in Asia despite a 1.0% rise in volumes, with the loss of discontinued brands in Australia a crucial impediment. Africa, the smallest segment by revenue in the last full year, saw revenue grow 10% thanks to volume expansion in most markets. Analyst Dirk Van Vlaanderen at Jefferies noted that SAB's three most profitable divisions (LatAm, Africa and South Africa) held up well in the context of a weak group performance. "Given the unpredictability of weather, we sense this must have been a weaker quarter than management were expecting and we certainly expect a much-improved performance in the remainder of the year." He added that he still expects consensus earnings downgrades as the market digests this weaker Q1 performance.
Brewer SABMiller saw lager volumes drop in Europe and North America but toasted improved overall group revenue in the first quarter. Group revenue and group revenue per hectolitre both grew by 2.0% on an organic basis at constant currencies, but depreciation of several key currencies against the US dollar will adversely impact reported results. Chief Executive Alan Clark said: "Our first quarter revenue growth was held back by unseasonably cold and wet conditions in many of our northern hemisphere markets, which negatively impacted beer consumption. This was offset by continued growth in our Latin America and Africa divisions." Total beverage volumes were level with the prior year thanks to the offset from Latin America and Africa, with soft drinks volumes up 8% on an organic basis thanks to growth in Latin America, Europe and Africa. Latin Ameirca, the group's largest market, saw group revenue bubble up 6.0% thanks to lager volumes frothing up 2.0% on an organic basis, despite slower economic growth and price increases towards the end of the prior year in Colombia and Peru. The unseasonably cold and wet weather in Europe during April, May and June put a further dampener on the already weak consumer sentiment, leading to 7.0% seepage in lager volumes, which begat a 3.0% decline in overall volumes.
Shares of SAB Miller closed the session 1.39% higher to stand at £32.57.
SAB Miller Corporate accountability and risk assurance committee (CARAC) member Geoffrey Bible purchased 2,600 shares in the company, at a price of £31.98, on July 1st; the company informed investors on Monday, July 8th. The company's shares have seen some profit taking since mid-May despite having reported on May 23rd that group revenue increased to $34.48bn in the 12 months up to March 31st from $31.4bn a year earlier. In parallel, earnings before interest, taxes and amortisation (EBITA) rose 14% to $6.42bn. On June 28th broker Nomura cut its target price on the firm's shares to 3,300p from 3,450p after shaving its 2014 earnings per share estimates by 3% as a result of what it termed "currency headwinds." Nomura also voiced concern about the ability of big beer to adapt to the "small is beautiful" trends visible in many beer markets. However, it believes the company is in a stronger position than some of its peers given its decentralised approach, together with the focus on local brands.
SAB Miller: Numis initiates with a target price of 3700p and a buy recommendation.
SAB Miller: UBS revises target price from 2950p to 3300p, while leaving its neutral rating unchanged.
SAB Miller: Citigroup takes target price from 3200p to 3460p, while its buy recommendation is maintained.
SAB Miller: Credit Suisse takes price target from 3100p to 3300p and maintains an outperform rating. Exane BNP shifts target price from 3300p to 3333p keeping its outperform rating. Espirito Santo raises target price from 2570p to 2860p, while its neutral rating remains unchanged.
Positive Points: Organic group revenue growth came in at the upper end of expectations. Soft drinks volumes were 3% higher, lager volumes rose by 6% in Latin America and by 4% in Africa. Profits in Latin America, the company's largest region, rose by 15% at the half year stage, helped by selective price increases and savings from more efficient purchasing. Within the group's Asia Pacific region, volumes grew by 18% in India, with the company highlighting continued strong growth across the portfolio. In addition and importantly, the company pointed towards an improving trend in lager volumes for its Australian business, with sales for the quarter 4% below the prior year on a pro forma basis, excluding the impact of the termination of some licensed brands, compared with an 8% decline in the previous six months. The group acquired Australian brewer Foster's in December 2011. The board noted that "the integration programme in Australia remains ahead of schedule in respect of both synergy delivery and capability build." SAB Miller is the world's second biggest brewer by volume after Anheuser-Busch InBev. Around 70% of SAB Miller's sales still come from the Emerging Markets. The group's dividend policy continues to be progressive. The half year dividend was increased by 12%.