SAB Miller reports Chinese drop

Brewing giant SAB Miller is the latest drinks company to report a sales slump in China, as the economic downturn looks to be affecting the performance of beer rather than just spirits.

SABMiller is the world’s second biggest beer brewer (Photo: Ed Robinson/OneRedEye)

The company posted a 2% drop in revenue in Asia Pacific for the third quarter to December 31, while suffering a 7% decline in volume sales in the period.

The losses suffered at the tail end of 2014 topped off a poor year in the region for SAB Miller, with group revenue receding by 1% and volume sales by 4% for the year to date.

SAB Miller produces Snow beer in China – by volumes the largest beer brand in the world – which is therefore easily susceptible to losses.

“Competitive price pressure and reduced consumer spending due to negative sentiment” were blamed by the company, while “double digit declines in the northeast and central provinces” contributed most to the overall decline.

“The continuing impact of the previous quarter’s adverse weather conditions in key regions” also had a part to play in the Chinese results.

Performance in the US for the quarter was also disappointing. Volumes slumped by 3%, contributing to a 2% drop overall in 2014.

US domestic sales to retailers declined by 1.7%, with flagship brand Coors Light and the “below premium portfolio” – which includes Miller High Life – posting volume drops.

Alan Clark, SAB Miller chief executive, commented, “We continued to drive steady net producer revenue growth, notwithstanding varied local market performances, as we benefited from the breadth of our global portfolio of businesses.

“During the quarter, our Latin America and Africa businesses continued to grow both volumes and revenues, together with Europe, while more difficult trading conditions, particularly in China, held back the overall group performance.”