Brewer SABMiller is placing great store by growing in emerging markets in Africa and Asia, and an update today showed it is paying off.
The company, whose brands include Miller Lite and Peroni, said full year revenues grew by 5% and lager volumes rose by 2%. Within this, Latin America volumes were flat, Europe fell by 3% but in Africa lager volumes jumped 13% and in Asia by 8%.
Rising commodity prices are of course a concern for companies like SAB, which said raw materials costs over the year were marginally lower, but had increased moderately during the second half.
The update helped lift SAB's shares 29.5p to £22.20. Investec analyst Martin Deboo said:
We see these as a strong set of numbers from SAB that, along with reassurance on costs, should be good for the shares this morning. However we note that SAB remains close to the top of its trading range on prospective PE relative to both the FTSE 100 and global brewing peer group. So a decent amount of expectation is priced in. We retain our multiples-based target price and hold recommendation.
