SABMiller Says Weak Rand, Europe Currencies Curbed Sales
SABMiller Plc (SAB), the world’s second- biggest brewer, said the weakness of the South African rand and central European currencies against the dollar weighed on sales growth in the first six months of the financial year.
Shifts in foreign-exchange rates reduced the gain in group revenue by six percentage points to 11 percent, the London-based maker of Grolsch and Peroni said today in a statement.
SABMiller gets about a fifth of sales from South Africa, where beverage revenue fell 5 percent in the first half because of the declining rand. At constant exchange rates, revenue rose 10 percent, said the brewer, which reports in dollars.
The rand has declined 24 percent against the dollar since April 2011, the worst performer out of 25 emerging-market currencies monitored by Bloomberg. It depreciated as much as 1.9 percent yesterday to weaken beyond 9 per dollar for the first time in three years as inflation quickened more than estimated in October, exacerbating challenges for South Africa’s economy including slowing growth, the worst labor unrest since the fall of apartheid and two credit-rating downgrades.
SABMiller’s European earnings were also hurt by foreign- exchange shifts, falling 10 percent compared with a 5 percent decline on an organic, constant-currency basis.
The Polish zloty and Czech koruna both weakened 17 percent against the dollar in the six months through Sept. 30, compared with the same period of last year, according to data compiled by Bloomberg. The depreciation was driven by the worsening of Europe’s debt crisis and the global strengthening of the dollar.
The brewer makes eight Polish beers including Lech and Zubr, while in the Czech Republic its 14 brands include Birell, Frisco and Gambrinus, according to the company’s website.
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