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SABMiller PLC - ABI Preliminary Results

RNS Number:1685Y
30 April 2004

                           FOR THE YEAR ENDED
                             31 MARCH 2004

Amalgamated Beverage Industries Limited (ABI), a subsidiary of SABMiller plc,
has reported its preliminary reviewed group results in Johannesburg for the year
ended 31 March 2004.  The text of ABI's announcement follows.  It should be
noted that the preliminary group results have been prepared to conform to South
African Statements of Generally Accepted Accounting Practice.

Enquiries to:
Sandra Pienaar
Company secretary
Telephone: +27 11 719 1400


  * Beverage volumes up 7.8% to 13 million hectolitres
  * Sales revenue grows by 12.9% to R5.6 billion
  * Trading profit increases by 20.4%, exceeding R1 billion
  * Adjusted headline earnings increase by 21.1% to R775 million
  * Dividends per share increase by 21.7% to 280 cents per share


ABI has delivered a good set of results for the year ended March 2004 through
strong volume growth, revenue management and ongoing productivity gains.  The
sales volume growth of 7.8% for the year was a function of sustained increases
in consumer disposable income, favourable weather conditions in the peak summer
season, brand innovations and effective market execution.  Mainstream carbonated
soft drink volumes increased by 6.8%, while other soft drinks grew by 31.0%.
The latter now contribute 5.0% to the total volumes sold, up from 4.3% at the
end of the previous financial year.

Financial performance

Adjusted headline earnings increased by 21.1% compared to the prior year.  This
increase is calculated after adjusting for the benefit of the R69 million
deferred tax adjustment arising from an assessed tax loss within New Age
Beverages, which was accounted for in the F03 results, and more correctly
reflects ABI's underlying trading performance.  Unadjusted headline earnings
increased by 9.3%.

The positive sales revenue growth of 12.9% was driven by the combined effect of
volume growth and selling price increases.  This was partly offset by package
mix changes and growth in non-carbonated soft drink contributions.

Gross margins reflected an improvement from 38.4% to 40.1%, largely as a result
of moderated increases in raw material costs in the latter half of the year.
Results also benefited from sustained improvements in manufacturing and supply
chain efficiencies.

Trading profit grew by 20.4% over the prior year, strengthening ABI's trading
margin to 18.7% from 17.5%, as further overhead productivity gains were realised
in areas of manufacturing and distribution.  These sustainable productivity
improvements were temporarily moderated by the impact of a write-down of fixed
assets in the hands of customers following a detailed review of coolers and
discontinued returnable containers in the trade.

Working capital management excluding an increase in prepayments for the purchase
of glass and resin at attractive Rand rates, continued to show improvements.
ABI has more than R800 million cash on hand and in the financial year invested
R450 million in fixed assets to maintain and expand operations.  The large
investment in returnable containers was made to ensure sufficient capacity to
meet peak and future market demands.


ABI continues to take a holistic approach to business sustainability with
appropriate investment in health and safety, the environment and the communities
within which the company operates.  In this regard, good progress was made in
NOSA and ISO 14000 ratings during the year.  Further investments in
sophisticated bottle inspection equipment resulted in improved product quality

ABI's staff Hiv/Aids programme, covering awareness, voluntary testing and
treatment at company cost progressed in the year.  Reasonable progress has been
made in staff volunteering for testing - this is seen as the key first step in
the management and prevention of the disease within the group.

In the broader community, ABI continues to support initiatives that lessen the
effect of Hiv/Aids through partnerships with NOAH (Nurturing Orphans of Aids for
Humanity) and The Starfish Foundation.  Two NOAH community 'Arks' have been
built with ABI support.

ABI has participated in, and met the requirements for, the JSE Socially
Responsible Investment Index, which is to be launched shortly.


Sales volumes are expected to continue the positive momentum in the new
financial year albeit at a lower rate than achieved in the year under review.
Alongside a constructive pricing outlook, major input costs are likely to remain
relatively stable for the year, subject to Rand volatility.  Further
productivity improvements are planned in the optimisation of the distribution
grid.  While the level of competition has increased over the past year, ABI
remains confident that through proactive brand and marketing initiatives the
company's market position will be maintained.  Management expects continued real
growth in earnings in the coming year but at a lower rate than that of the
current year.

Accounting policies

These results have been compiled in accordance with the South African Statements
of Generally Accepted Accounting Practice and the listing requirements of the
JSE Securities Exchange South Africa and Schedule 4 of the South African
Companies Act.  With the exceptions noted below, the accounting policies and
methods of computation used in the preparation of the results are consistent in
all material respects with those adopted in the annual financial statements for
the year ended 31 March 2003.  The following exceptions should be noted:

   *   Accounting statement AC133 dealing with the recognition and measurement
       of financial instruments, has been applied in preparation of the results
       for the year.

   *   The ABI Executive Share Incentive Scheme and ABI Share Purchase Scheme
       have been consolidated in accordance with the requirements of the JSE
       Securities Exchange South Africa.

The net effect of the above changes in accounting policy on retained income was

Ernst & Young, the company's external auditors, have reviewed the financial
results.  A copy of their unmodified report is available for inspection at the
company's registered office.

Declaration of dividend number 57

Notice is hereby given that on 29 April 2004, the board of directors declared a
final dividend of 231 cents per share (2003: 189.6 cents) for the year ending 31
March 2004.  This dividend will be paid out of profit on ordinary activities
after taxation, as determined by the directors, to ordinary shareholders
recorded as such in the register at the close of business on the record date,
Friday, 25 June 2004.  The last date to trade to participate in the dividend is
Friday, 18 June 2004.  Shares will commence trading ex-dividend from Monday, 21
June 2004.

The important dates pertaining to this dividend are as follows:

Last day to trade 'cum' dividend                     Friday, 18 June 2004
Shares trade 'ex' dividend                           Monday, 21 June 2004
Record date                                          Friday, 25 June 2004
Payment date                                         Monday, 28 June 2004

Share certificates may not be dematerialised or rematerialised between Monday,
21 June 2004 and Friday, 25 June 2004, both days inclusive.

Group income statements

                                                                 2004               2003      % Change
                                                           Year ended         Year ended
                                                             31 March           31 March
                                                                   Rm                 Rm
                                                           (Reviewed)          (Audited)
Revenue                                                         5,666              5,016            13

Sales revenue                                                   5,571              4,933            13

Cost of sales                                                 (3,339)            (3,041)

Gross profit                                                    2,232              1,892

Net operating costs                                           (1,192)            (1,028)

Trading profit before goodwill amortisation                     1,040                864            20

Goodwill amortisation                                            (78)               (78)

Operating profit                                                  962                786

Income from an associate                                           48                 47

Profit on ordinary activities before interest and               1,010                833            21

Net finance income                                                 66                 56

Profit on ordinary activities before tax                        1,076                889

Taxation                                                        (377)              (242)

Current taxation                                                (342)              (276)

Deferred taxation                                                   7                 65

Secondary tax on companies                                       (42)               (31)

Profit on ordinary activities after tax                           699                647

Equity minority interests                                        (11)               (15)

Net profit for the year                                           688                632

Reconciliation of headline earnings (Rm)

Net profit for the year                                           688                632             9

Loss/(profit) on disposal of property, plant and                    9                (1)
equipment after tax

Goodwill amortisation                                              78                 78

Headline earnings                                                 775                709             9

Deferred tax adjustment due to assessed loss                        -               (69)

Adjusted headline earnings                                        775                640            21

Earnings per share (cents)

  Basic earnings                                                  450                416             8
  Headline earnings                                               507                466             9

  Adjusted headline earnings                                      507                421            20

Dividends per share (cents)                                       280                230            22

Net asset value per share (cents)                               2 359              2 154            10

Number of ordinary shares in issue (million)                      153                152

Weighted average number of ordinary shares in
issue (million)                                                   153                152

Group balance sheets
                                                                                 2004              2003
                                                                             31 March          31 March
                                                                                   Rm                Rm
                                                                           (Reviewed)         (Audited)

Non-current assets                                                              3,010             2,933

Property, plant and equipment                                                   1,615             1,459

Investment properties                                                               3                 4

Goodwill                                                                        1,107             1,185

Investment in an associate                                                        235               216

Deferred taxation asset                                                            50                69

Current assets                                                                  1,580             1,370

Inventories                                                                       309               270

Trade and other receivables                                                       309               298

Prepayments                                                                       160                29

Cash and cash equivalents                                                         802               773

Total assets                                                                    4,590             4,303


Capital and reserves

Share capital and premium                                                       1,614             1,599

Non-distributable reserves                                                        (5)                 2

Accumulated profits                                                             1,976             1,652

Ordinary shareholders' funds                                                    3,585             3,253

Minority interest                                                                  24                21

Total shareholders' funds                                                       3,609             3,274

Non-current liabilities                                                           214               255

Long-term loans                                                                     6                11

Deferred taxation liability                                                       107               130

Deferred income                                                                    74                89

Retirement benefit obligation                                                      27                25

Current liabilities                                                               767               774

Trade and other payables                                                          707               688

Provisions                                                                         47                18

Current taxation                                                                   13                68

Total equity and liabilities                                                    4,590             4,303

Future capital expenditure
Contracted                                                                          6                76

Authorised by the directors but not yet contracted                                437               401

Group cash flow statements
                                                                               2004                2003
                                                                         Year ended          Year ended
                                                                           31 March            31 March
                                                                                 Rm                  Rm
                                                                         (Reviewed)           (Audited)

Trading profit before goodwill amortisation                                   1,040                 864

Depreciation                                                                    217                 180

Non-cash items                                                                    1                  56

(Increase) / decrease in working capital                                      (126)                  37

Cash generated from operating activities                                      1,132               1,137

Dividend income                                                                  28                  23

Normal tax paid                                                               (394)               (266)

Secondary tax on companies paid                                                (42)                (31)

Net cash inflow from operating activities                                       724                 863

Finance income received                                                          73                  53

Finance costs paid                                                                -                 (3)

Dividends paid                                                                (366)               (277)

Net cash retained                                                               431                 636

Cash utilised in investment activities                                        (409)               (321)

Investment to maintain and upgrade operations                                 (209)               (127)

Investment to expand operations                                               (241)               (227)

Proceeds on assets sold                                                          41                  33

Cash effects of financing activities                                             10                  11

Long-term loans (repaid) / incurred                                             (5)                  11

Premium on issue of share capital used for share options                         15                   -

Analysis of movement in cash and cash equivalents

Balance at the beginning of the year                                          (773)               (450)

Currency translation reserve                                                      3                   3

Balance at the end of the year                                                  802                 773

Increase in cash and cash equivalents                                            32                 326

Statements of changes in equity

                      Ordinary Ordinary Non-distri-butable  Accu-mulated       Ordinary   Minority         Total
                        share     share           reserves        profit  share-holders' interests  share-holders'
                       capital  premium                                           funds                    funds

                            Rm       Rm                 Rm           Rm             Rm        Rm             Rm

Balance at 31 March
2002                         1    1,598                  5        1 297          2,901        10          2,911

Foreign currency
differences                  -        -                (3)            -            (3)       (3)            (6)

Net profit for the
year                         -        -                  -          632            632        15            647

Dividend                     -        -                  -        (277)          (277)       (1)          (278)

Balance at 31 March
2003                         1    1,598                  2        1,652          3,253        21          3,274

Premium on issue of
share capital used
for share options            -       15                  -            -             15         -             15

Foreign currency
differences                  -        -                (7)            -            (7)       (6)           (13)

Net profit for the
year                         -        -                  -          688            688        11            699

Dividend                     -        -                  -        (364)          (364)       (2)          (366)

Balance at 31 March
2004                         1     1613                (5)        1,976          3,585        24          3,609

By order of the board

MJ Bowman                                          V Pillay
Managing director                        Financial director

29 April 2004

Directorate and administration

Non-executive chairman
EAG Mackay

Independent non-executive directors
MP Adonisi
PM Bester

Non-executive directors
JA Mabuza
MI Wyman (British)

Executive directors
MJ Bowman (managing director)
EM Borcherds
TK Gibbon
MJ Hoy
AP Lemmert
HBB Lloyd
V Pillay
TC Sanderson

Company secretary
S Pienaar

Registered office
ABI House
14 Pongola Crescent
Eastgate Extension 17
Sandton 2199
P O Box 76202
Wendywood 2144
South Africa

Transfer secretaries
Computershare Limited
70 Marshall Street
Johannesburg 2001
PO Box 61051
Marshalltown 2107
South Africa

                      This information is provided by RNS
            The company news service from the London Stock Exchange


Share price data provided by vwd group & financial data provided byMorningstar.