The soon-to-be acquired SABMiller toasted its "good" results for the financial year to 31 March this morning, despite taking hits from currency headwinds and lower reported profits.
Profit before tax came in at $4.07bn, down 16 per cent from $4.83bn in 2015, after the brewer had to manage exceptional charges of $721m, including costs incurred from the Anheuser-Busch InBev takeover deal, which chief executive Alan Clark described as a "distraction".
Revenues at the British drinks giant reached $19.83bn (£13.71bn) in the company's full-year results to 31 March, although this was down 10 per cent from $22.13bn last yearr. Results were hit by currency headwinds, particularly a strengthening dollar.
Group net producer revenue grew by five per cent, while beverage volumes across all brands increased by two per cent. Lager volumes rose by one per cent and soft drinks volumes were up six per cent.
Miller Brands reported five per cent net producer revenue growth, driven by brands such as the Italian stalwart Peroni Nastro Azzurro and the Czech brand Pilsner Urquell.
The company will pay up a dividend per share of 122.0 cents, up eight per cent year on year, with a final dividend of 93.75 cents per share payable in August.
Why it's interesting
SABMiller is in the process of preparing for AB InBev's £71bn takeover deal, which was agreed last October and will be the largest ever British corporate merger.
However, some of the brands that have driven the strongest growth in the full-year results today are set to be sold off in the wake of the takeover, as AB InBev has told the European Commission it will sell all of SABMiller's Central and Eastern European brands in order to push through with the "Megabrew" deal.
SABMiller's businesses in Hungary, Romania, Czech Republic, Slovakia and Poland will be put up for sale, in addition to the sale of Peroni, Grolsch and Meantime and their related businesses to the Japanese drinks firm Asahi in a $2.55bn deal.
What SABMiller said
Chief executive Alan Clark said:
These are good results. This performance reflects our focus on driving superior growth by strengthening our core brands, expanding the beer category to reach more consumers on more occasions and placing an emphasis on premiumisation in all regions. As noted through the year, the strengthening dollar against our operating currencies had a material negative impact on reported results.
Our affordability and premiumisation initiatives have allowed us to capture growth in developing markets and key trends in developed markets.
In creating a more integrated global business we have been able to cut costs and free up in-market resources to deliver on our strategic objectives. We continue to focus on improving our in-country performance in a cost efficient manner, supported by our global cost and efficiency programme which is ahead of schedule and delivered cumulative net annualised savings of $547m by the year end. The programme is on track to achieve our 2020 target of $1.05bn.
What others said
"The preliminary results for the 12 months to March 31 are fairly strong on an organic, constant currency basis and may serve as a further reassurance to investors coming on the back of a good run in the share price over the past six months," David Cheetham, market analyst at XTB.com, said.
"The decline in profitability is attributed to the impairment of investments in Angola and South Sudan, as well as costs associated with the Anheuser-Busch Inbev transaction. Taking these as one-off in nature provides a heightened level of leeway with which this drop in the level of earnings can be viewed."