One of the world's largest beer brewers is seeing growth in a surprising area
Flickr/Maya83
While American customers know SABMiller best for beverages like Keystone and Coors Light, sales of MillerCoor’s beers in the US are on the decline. However, international soda consumption — especially in Africa — is helping drive growth for the beverage company.
SABMiller beat analyst predictions in the third quarter, reporting a 7% growth in underlying sales. The company, which is the second biggest brewer in the world, is in the process of being acquired by AB InBev (the world’s largest brewer), a deal that is anticipated to close in the second half of 2016.
Despite its status as a giant in the world of beer, nonalcoholic beverages are a major area of growth for the company.
Flickr/Maya83Soft drinks increased 8% by volume, with especially impressive growth in Africa, where volumes increased 13%. In South Africa, soft drinks volumes grew 21%, which the company attributed to warmer weather and the growth of its still beverages portfolio.
SABMiller is one of the biggest bottlers of Coca-Cola products worldwide, and a key Coke bottler in Africa. In 2014, the company formed Coca-Cola Beverages Africa, which serves 12 countries and accounts for about 40% of Coke beverage volume in the continent.
The company’s focus on soft drinks outside of the US has been a business boon, as globally soda consumption continues to rise, even if it is falling in the US.
Also falling in the US: sales of major beer brands like Coors, Miller, and Keystone. In the North American market, Coors Light and Miller Lite sales to retailers experienced low single digit decreases, while Keystone declined high single digits.
Bottling has long been an important part of beer companies' business, as AB InBev is a key PepsiCo bottler in Latin America. With soft drinks boosting SABMiller’s sales and years of rumors that AB InBev may one day acquire Coke, the merging of two Big Beer legends will likely also have a major impact on the soft drink industry.