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SABMiller PLC - Interim Results

RNS Number:3692F
SABMiller PLC
18 November 2004


                              SABMiller plc

                           INTERIM ANNOUNCEMENT

Ref 28/2004


                       ANOTHER STRONG HALF YEAR

London and Johannesburg, 18 November 2004. SABMiller plc today announces its
six-month results to 30 September 2004. Highlights are:

                                                                    2004        2003
                                                                    US$m        US$m         % change

Turnover **                                                        7,178       6,282            14

EBITA *                                                            1,141         888            28

Profit before tax                                                  1,196         665            80

Adjusted profit before tax *                                       1,050         800            31

Adjusted earnings *                                                  583         422            38

Adjusted earnings per share *
- US cents                                                          48.8        35.4            38
- UK pence                                                          26.9        21.9            23
- SA cents                                                         316.9       267.7            18

Adjusted diluted earnings per share * (US cents)                    46.8        34.3            36

Basic earnings per share (US cents)                                 58.5        25.8           127

Dividends per share (US cents)                                      12.0         7.5            60

Net cash inflow from operating activities                          1,262       1,088            16

** 2003 turnover has been restated downward by US$46 million comprising a
downward restatement of US$126
million to reflect the adoption of FRS5 Reporting the substance of transactions,
application note G - revenue
recognition and a US$80 million upward restatement in respect of the turnover of
the Italian distribution
companies excluded at the prior half year.

* EBITA and adjusted profit before tax comprise profit before interest and tax
(US$1,287 million) and profit
before tax (US$1,196 million) respectively before goodwill amortisation (US$181
million), and before
exceptional items (net credit US$327 million - see note 3). The calculation of
adjusted earnings and earnings
per share is given in note 5.

*         Lager beer volumes up 8% to 82 million hls, organic up 5%
*         Group EBITA up 28%
*         Strong results from all business segments
*         Continued progress on Miller turnaround
*         Strong volume and performance in Beer South Africa
*         Good performance across the Africa & Asia portfolio
*         Europe benefiting from strong Russian growth
*         Interim dividend of 12.0 cents reflects earnings growth and an interim
          /final re-balancing



                                                                     Reported     Organic, constant
                                                   2004                growth              currency
                                  Pre-exceptional EBITA                     %                growth
                                                   US$m                                           %

North America                                      306                    23                    23
Central America                                     37                    15                    21
Europe                                             300                    17                    11
Africa and Asia                                    179                    34                    30
Beer South Africa                                  249                    35                    16
Other Beverage Interests                            68                    65                    43
Hotels and Gaming                                   33                    69                    45
Central Administration                             (31)                    -                     -
Group                                            1,141                    28                    21


Statement from Graham Mackay, Chief Executive

"These results are impressive for their strength and their breadth and
demonstrate our ability to deliver good, organic, constant currency growth in
EBITA from all our business segments despite some challenging operating
environments. The turnaround in the performance of Miller was a strong feature.

The strength of our brands, leading positions in many markets and improving mix
effects, underpin our position as one of the leaders in the brewing industry,
with a strong business portfolio, well balanced between established and
developing markets."

Enquiries:

                               SABMiller plc                           Tel: +44 20 7659 0100

Sue Clark                      Director of Corporate Affairs           Mob: +44 7850 285471

Gary Leibowitz                 Vice President, Investor Relations      Mob: +44 7717 428540

Nigel Fairbrass                Head of Corporate Communications        Mob: +44 7799 894265
                               (Finance)

Philip Gawith                  The Maitland Consultancy Ltd            Tel: +44 20 7379 5151

A live webcast of the management presentation to analysts will begin at 9.30am
(GMT) on 18 November 2004.
This announcement, a copy of the slide presentation and video interviews with
management are available on the
SABMiller
plc website at www.sabmiller.com . Video interviews with management can also be
found at www.cantos.com.
High resolution images are available for the media to view and download free of
charge from www.vismedia.co.uk
Visit www.thenewsmarket.com/SABMiller to download broadcast-standard MPEG2 video
or order a Beta SP tape.
Registration and video is free and available for accredited journalists and news
producers.


Registered office:  Dukes Court, Duke Street, Woking, Surrey, GU21 5BH

Telephone: +44 1483 264000
Telefax:   +44 1483 264103


CHIEF EXECUTIVE'S REVIEW                                                                                        3

Business review

This was another six months of strong performance across the group with total
organic volumes growing by over 5% and market share growth achieved in each of
our business segments. We have continued to build our business, with
acquisitions in China and Romania, and to make significant investments in brand
marketing, channel development and brewing infrastructure.

In North America the results from Miller Brewing Company are beginning to
reflect the wide ranging actions we have taken to turn around the business with
volume growth resuming and EBITA increasing 23%. Impressive operating
performances in our African and South African businesses have been enhanced by
favourable currency movements.  Europe delivered good growth off a high base,
despite poorer weather than the prior year in the early part of summer.

Group beverage volumes totalled 100 million hectolitres (hls), an 8% increase on
the comparable six-month period. Lager beer volumes were up 8% to 82 million
hls, including organic growth of some 5%. Reported EBITA of US$1,141 million (up
28%), reflects strong operating performances with improved pricing and mix in
our key markets.  On an organic, constant currency basis, EBITA increased 21%.
Adjusted earnings are up by 38%, to US$583 million, with adjusted earnings per
share of 48.8 US cents, also up 38% on the first six months of the prior year.

An interim dividend of 12.0 US cents per share, a 60% increase, will be paid to
shareholders.  This partly reflects the growth in earnings and an intention to
raise the interim dividend as a percentage of the full year dividend.

The balance sheet remains strong and net cash inflow generated from operating
activities reached US$1,262 million.  Gearing decreased to 31.6% as at 30
September, down from March's 43.3%.

North America

Significant progress has been made in North America. Improved brand building
together with sales and distribution initiatives have resulted in strong growth
from Miller Lite, the largest brand in the portfolio.  This has been the key
factor behind an increase in overall company volumes, as detailed in the North
America section below.

Building on the improvements to date, the Miller management team is continuing
to focus on the recovery and medium-term growth of the business, with emphasis
on the four key areas that we have outlined previously.

Central America

Earnings from Central America have recovered from the low level recorded in the
prior year. Whilst the carbonated soft drink (CSD) market remains weak, the
increase in EBITA reflects the success of the prior year's restructuring work in
both beer and CSDs. Local management continues to strengthen the brand
portfolios and improve distribution for both beer and CSDs.

Europe

In Europe our business delivered a 17% increase in EBITA in the half year, with
11% organic growth in constant currency terms. These results were achieved
despite significantly cooler and wetter weather than in the previous summer.
Strong volume growth in Russia and a significant improvement by Poland in the
second quarter more than offset volume declines in Italy, Hungary and Slovakia.

CHIEF EXECUTIVE'S REVIEW  (continued)                                                                           4

Africa and Asia

Africa produced pleasing EBITA results in the half year, reflecting revenue
management and operational performances in the key markets of Botswana and
Tanzania, and an increased contribution from Castel. CSD volumes grew
significantly in Angola, as new capacity was commissioned.

Our Chinese associate, China Resources Snow Breweries Ltd (CR Snow), formerly
China Resources Breweries Ltd, has further consolidated its position in China,
through the acquisition of a green field brewery site in Dongguan in Guangdong
province, as announced in August, and the acquisition of the former Lion Nathan
breweries which was completed in October 2004.  Organic volumes and EBITA grew
in our existing Chinese operations.

South Africa

Beer South Africa increased its share of the total alcoholic drinks market to
59.8%, with volume growth across all sectors of the beer market and a notably
strong performance in the premium sector. ABI has had an excellent first half
performance, with 8% growth in beverage volumes. For both businesses, higher
volumes, together with robust pricing management, have led to good growth in
earnings which has been enhanced by favourable currency movements.

Outlook

The rate of reported earnings growth achieved in each of the last three six
month reporting periods has been particularly strong.  Miller's turnaround
progress, our Central American restructuring late in the previous financial year
and favourable currency movements are together providing more stretching
comparables for this year's second half.  At the same time SABMiller is
increasing its investments in brand marketing and facing higher global commodity
costs.  Our businesses are, however, benefiting from strengthening market
positions and improving mix, and with increased investment are well placed to
deliver sustainable organic growth.

CHIEF EXECUTIVE'S REVIEW  (continued)                                                                           5

Operational reviews

North America


                                                                           2004          2003     % change
Financial summary                                                          US$m          US$m

Turnover **                                                              2,615         2,526            4
EBITA £                                                                    306           249           23
EBITA margin (%)£                                                         11.7           9.9

Sales volumes (hl 000s)
Lager - excluding contract brewing                                      25,427        25,030            2
Lager - contract brewing                                                 5,562         5,734           (3)
Carbonated soft drinks (CSDs)                                               46            44            5


**  2003 turnover has been restated downwards by US$53 million to reflect the
adoption of FRS5 Reporting the substance of transactions, application note G -
revenue recognition

£ Before exceptional profit on the sale of Tumwater brewery of US$4 million
(2003: before exceptional restructuring costs of US$13 million)

During the first half of the financial year Miller continued to focus on the key
elements of its turnaround strategy: brand building, sales and distribution,
costs and productivity, and organisational capability. The results for the
half-year reflect the progress that has been made on all of these dimensions,
and the medium term turnaround plan remains on schedule.

The first half of the year has been a challenging one for the beer industry as a
whole with poor weather, rising energy and fuel costs and increased competition
from the wine and spirits categories. Total US industry domestic shipment
volumes increased by approximately 1% during the first half of the financial
year, however the rate of growth slowed during the second quarter with US
domestic shipments estimated to have increased by some 0.1%.

Despite these conditions, Miller's US domestic sales to retailers (STRs) grew by
2.3% over the six months, whilst domestic shipments to wholesalers (STWs) rose
by 2.2%.  Second quarter US domestic sales to retailers increased by 1.8%. Total
shipment volumes for the period under review rose by 1.6% to 25.4 million hls.
Export sales were depressed by difficult trading conditions in important
markets, and contract brewing volumes were lower by 3%.

The increase in domestic STRs has been driven by a significant improvement in
the performance of Miller Lite which experienced double-digit growth during the
period under review. These results reflect the improvement in brand health as
well as the impact of our enhanced local market planning and execution.  Miller
Genuine Draft continues to decline ahead of its full-calorie market segment and
plans are now being put in place to slow that decline with a view towards
stabilising the brand.  Increased focus is now being directed at the key brands
in the economy portfolio, particularly Miller High Life and Milwaukee's Best.

Turnover during the first half grew by 3.5% versus the restated prior period, to
US$2,615 million. US domestic turnover grew by approximately 5% versus the
restated prior period.  Net producer revenue per hl increased above the industry
average.  This is the result of a more disciplined approach in adopting price
increases, together with a favourable brand mix following the improvement in
Miller Lite sales, which was partly offset by unfavourable package mix.
Contract brewing revenues declined ahead of volume declines as a result of
unfavourable mix impacts.

Improved efficiencies in our breweries partially offset commodity price
increases, health care and retirement funding costs, investments in
manufacturing and costs associated with building depth in organisational
capabilities.  Other general and marketing cost efficiencies were achieved,
however these savings were partially invested in key areas such as information
systems, specialised sales staff, recruitment and increased media and
experiential marketing programmes.

CHIEF EXECUTIVE'S REVIEW  (continued)                                                                           6


EBITA for the period, of US$306 million, was 23% higher than the prior year's
US$249 million, driven by the higher turnover, favourable brand mix and cost
efficiencies achieved.  Overall EBITA margin increased to 11.7% following the
favourable pricing environment and increased volumes.

Miller continues to progress all four dimensions of its medium-term turnaround
strategy.  Improved marketing capabilities and brand building approaches that
have been successful in improving Miller Lite brand health measures are now
being applied to other key brands.  The creation of a specialised sales force,
improved alignment with our distributors and activation of below-the-line
marketing activities are driving further improvements in sales and distribution
execution while productivity gains across the value chain are being re-invested
behind key business priorities.  Finally, steady progress on building
organisational capability is continuing as performance management becomes
further entrenched, and new talent and personnel development initiatives are
being introduced into the organisation.

Profitability in the second half of the year will be impacted by further
investments in key consumer-facing marketing, further sales force and local
marketing execution costs, innovation expenditure, and higher raw material and
energy costs, as well as increased focus on recruitment, training and
development.

CHIEF EXECUTIVE'S REVIEW  (continued)                                                                           7


Central America

                                                                           2004          2003     % change
Financial summary                                                          US$m          US$m

Turnover **                                                                260           265           (2)
EBITA £                                                                     37            32           15
EBITA margin (%)£                                                         14.2          12.1

Sales volumes (hl 000s)
Lager                                                                      891           882            1
Carbonated soft drinks (CSDs)                                            2,886         3,044           (5)
Other beverages                                                          1,410         1,307            8


**  2003 turnover has been restated downwards by US$17 million to reflect the
adoption of FRS5 Reporting the substance of transactions, application note G -
revenue recognition

£ Before exceptional reorganisation costs of US$2 million in 2003

The results in the half year display progress notwithstanding tough trading
conditions, particularly in El Salvador. Disposable incomes in both countries
have been impacted by high fuel costs, and consequent increases in electricity
and public transport costs. Economic growth in El Salvador has slowed
significantly due to the effects of delayed expenditure caused by the
uncertainty in the outcome of the presidential elections and postponement in the
approval of the central government budget. Further progress has been made in
this period to strengthen our portfolio of brands and to improve execution
through customer focused channel marketing.  Following the successful
introduction of local premium beer brand Bahia in El Salvador in the prior
period, the brand was launched in Honduras during the current year and continues
to grow share ahead of expectation.  Beer volumes rose by 1% across the
business, with strong growth in Honduras being partially offset by a decline in
El Salvador.

Aggregate CSD volumes fell by 5%, which reflects the price-based competitive
activity that has intensified in El Salvador. Whilst our CSD market share is
relatively stable in Honduras, volume share has been lost in El Salvador.  We
have implemented price increases in both markets to improve the profitability of
the CSD market, and we plan to introduce lower-priced offerings in selected
market segments to compete on a price basis with the competition. We continue to
support our sector leadership in focusing on attribute rather than price-based
competition. The growth in other beverage volumes reflects increased sales of
bottled water.

Turnover for the period grew by 1% on a constant currency basis, reflecting
improved pricing for both beer and CSDs. Improved revenue management through
brand segmentation and portfolio management has yielded benefits, and continues
to support price increases across the business.  This improved pricing, strong
control of operating costs, and the lower cost base in the business following
the restructuring activities have led to higher EBITA (21% up in constant
currency terms) and EBITA margin.

CHIEF EXECUTIVE'S REVIEW  (continued)                                                                           8


Europe

                                                                         2004          2003     % change
Financial summary                                                        US$m          US$m

Turnover **                                                            1,617         1,370           18
EBITA £                                                                  300           256           17
EBITA margin (%)£                                                       18.5          18.7

Sales volumes (hl 000s)
Lager                                                                 19,797        17,961           10
Other beverages                                                            -            63         (100)



**  2003 turnover has been restated upward by a net US$33 million comprising a
downward restatement of US$47 million to reflect the adoption of FRS5 Reporting
the substance of transactions, application note G - revenue recognition and an
upward restatement of US$80 million to reflect the turnover of the Italian
distribution companies excluded in the prior half year.

£Before exceptional Naples brewery closure costs of US$23 million.

Total lager volumes for the half-year grew 10% (4% on an organic basis),
negatively influenced in the early part of summer by significantly cooler and
wetter weather than in the previous year, whilst good sales in September boosted
second quarter growth. Strong volume growth in Russia and a significant
improvement in Poland in the second quarter more than offset volume declines in
Italy, Hungary and Slovakia.

The division produced satisfactory profit growth, with pre-exceptional EBITA up
17% (11% in organic constant currency terms). This consolidates the previous two
years' performance, which each had annual growth in organic constant currency
EBITA in excess of 20%. The reported EBITA margin has been impacted by the
inclusion of a full six months for Birra Peroni and Dojlidy where margins are
currently lower than the average of our Europe operations.

The Polish beer market expanded by around 1% with the fastest growth continuing
to be in lower priced segments. Kompania Piwowarska's total volumes increased by
a commendable 12%, with organic growth of 9%, resulting in an increase in market
share to 34% on a year to date basis.  This growth reflects successful sales and
merchandising initiatives executed in the growing key account and on premise
channels.  The relaunch of the Lech brand in June led to a sharp increase in
sales at a premium price point with strong growth in the second quarter. Zubr
continues to grow rapidly in the lower mainstream segment, with its latest year
to date national brand share exceeding 6%. Tyskie remains the largest Polish
brand with a national volume share of over 16%. The Dojlidy integration is
complete, with synergies in line with plan.  Continuing industry real price
declines and increasing investment in sales and marketing constrained Polish
profitability.

In Czech, total industry volumes declined by an estimated 5% compared to the
high base set by last year's exceptionally warm dry summer. Plzensky Prazdroj
gained 60 points of market share within this declining market, and its overall
volumes were down 2% on the prior half year.  Our international premium brand,
Pilsner Urquell, grew by 2% domestically.  Profit performance benefited from
real improvements in prices, brand mix, and the continued strength of the Czech
currency.

In Russia, Transmark's strong volume growth continued at 51%, including growth
in Miller Genuine Draft sales volumes of over 80%.  All of our brands are
focused in the premium segment, which grew by 32% in the period under review,
within a beer industry which grew at around 10%.  Profitability increased
significantly as our Russian operations also benefited from greater economies of
scale in relation to marketing, production and overhead expenses.  Recently, new
legislation governing the beer industry in Russia has led to advertising
restrictions being implemented in September. New consumption laws, mainly
related to outdoor drinking, have been proposed but have not as yet been
finalised.  It is too early to estimate their impact on the Russian beer
industry or on our operations in particular.


CHIEF EXECUTIVE'S REVIEW  (continued)                                                                           9


The Italian domestic beer market declined by an estimated 7%, following the
exceptional summer in 2003 and reflecting a poor consumer spending environment.
This, together with the termination of the Anheuser-Busch licence as
anticipated, resulted in Birra Peroni volumes declining 12% on an organic basis.
Margins have reduced as a result of this volume decrease, a soft pricing
environment, consumer down-trading and channel switching into the off-premise
market. Our cost reduction programme is on track and, from January 2005, the
Padua brewery will produce Miller Genuine Draft for all our EU operations.
Birra Peroni has commenced the restructuring of its marketing, merchandising,
route-to-market and production operations, and in October announced the closure
of the Naples brewery.  A charge of US$23 million has been taken in the period
under review to reflect a reduction in the carrying value of the fixed assets at
Naples, and in the second half of the year there will be a further restructuring
charge, including the cost of redundancies, bringing the total exceptional
charge for the year to an estimated US$40-50 million.

Our Romanian operations are significantly outperforming the industry's 2% growth
with organic volumes up 14%. Ursus has become the country's leading beer brand
and its growth is driving margin enhancement, while Timisoreana Lux's increasing
popularity and availability is driving volume. Revenues grew significantly ahead
of volumes, driven by positive price and mix trends, and profitability was
further enhanced by improving economies of scale.  In June we acquired SC Aurora
SA for approximately US$26 million. This acquisition provides us with a leading
regional brand in Romania and the first PET pack in our European operations.

In Hungary the domestic market has declined some 13%, losing significant volumes
to heavily discounted cans imported from Germany following that country's
imposition of a can deposit system.  A large number of local economy brands have
also been introduced.  Dreher's volume loss is in line with the market, and
profitability has been impacted accordingly.

The Slovakian market declined by some 13% following a significant excise
increase last year, and whilst our market share has increased, our volumes are
down 8%. In the Canaries, our volumes are level with prior year, with market
share unchanged, whilst productivity gains have assisted margins.

CHIEF EXECUTIVE'S REVIEW  (continued)                                                                          10


Africa and Asia

                                                                        2004          2003      % change
Financial summary                                                       US$m          US$m

Turnover **                                                             870           735            18
EBITA £                                                                 179           134            34
EBITA margin (%)£                                                      20.6          18.2

Sales volumes (hl 000s)*
Lager                                                                23,851        20,691            15
Carbonated soft drinks (CSDs)                                         2,000         1,671            20
Other beverages                                                       6,113         5,354            14



**  2003 turnover has been restated downward by US$9 million to reflect the
adoption of FRS5 Reporting the substance of transactions, application note G -
revenue recognition

£Excludes exceptional profit of US$96 million on the disposal of the group's
interest in Harbin Brewery Group Limited (Harbin)

* Castel volumes of 6,397 (2003: 6,091) hls 000s lager beer, 4,215 (2003: 4,967)
hls 000s carbonated soft drinks and 1,337 (2003: 1,964) hls 000s other beverages
are not included.

Africa

Our portfolio of African operations delivered a pleasing increase in volume for
the six months to September, with good beer volume gains in Mozambique and
Tanzania.  The net result was an increase of 5% in total African lager volumes
compared to prior year, with good growth in Castle brand volumes. During 2004,
the management responsibility for sales to Angola was transferred from Beer
South Africa to the Africa division. On a pro-forma comparable basis, the
increase in lager volume would have been 3% over the prior half year. CSD
volumes also increased, with good gains in Angola as the economy improved, new
packs were introduced and capacity was increased. In Zimbabwe, beer and CSD
volumes staged a recovery from the prior year's low levels.

Beer volumes in Castel, in which we have a 20% interest, grew by 5%, whilst
lower volumes of CSD and other beverages were due to the sale of their Moroccan
soft drinks business in the prior year. EBITA has increased over the prior year,
reflecting strong operating performance.

Overall EBITA performance was strong, reflecting the volume growth in Mozambique
and Tanzania together with benefits from productivity gains in Botswana, where
volumes were impacted by a devaluation of the currency. Local currency EBITA
growth is in line with reported growth, as currencies have generally held firm
against the US dollar.

Asia

We have further consolidated our position in the Chinese beer market, through
our associate, which changed its name to China Resources Snow Breweries Ltd. We
announced acquisitions of additional breweries in Zhejiang and Anhui provinces.
We are also entering attractive new markets which feature higher average beer
selling prices through a further acquisition in Jiangsu province, which offers
access to the greater Shanghai market, and through the construction of a new
brewery in Guangdong province. Together, these four additions will comprise
incremental production capacity of 15.8 million hls, an increase of 37% (versus
31 March 2004), at an average cost to CR Snow of approximately $30 per hl.

Our Chinese beverage volume growth for the first six months was 23%, and volumes
of the Snow brand grew by over 30%. Organic beer volume growth was 10%, compared
with a prior half year that had been impacted by the SARS epidemic. Good EBITA
growth was recorded against the prior half year, with the benefit from increased
volumes being partially offset by a somewhat soft pricing environment and an
increase in input costs.

We continue to hold our joint venture with the Shaw Wallace group of companies
in India as an investment for accounting purposes pending completion of the
transaction.  Sales volumes for the joint venture recorded a double-digit
increase for the period, almost twice the rate experienced by the overall Indian
market.


CHIEF EXECUTIVE'S REVIEW  (continued)                                                                          11


South Africa:

Beer South Africa

                                                                       2004          2003       % change
Financial summary                                                      US$m          US$m

Turnover                                                             1,096           831             32
EBITA                                                                  249           184             35
EBITA margin (%)                                                      22.7          22.2

Sales volumes (hl 000s)                                             11,992        11,651              3

Beer volumes for the six months to September grew by 3%, reflecting favourable
economic conditions and an increased share of the total liquor market.  During
2004, the management responsibility for exports to Angola was transferred to the
Africa and Asia division. On a pro-forma comparable basis, the increase in
volume would have been 4% over the prior half year.

Volume growth has been achieved across all market segments, with particularly
strong growth in premium beers, including Castle Lite, Amstel and Miller Genuine
Draft, and alcoholic fruit beverages, including Redds and Brutal Fruit. Beer
South Africa increased its share of the total alcoholic drinks market over the
last 12 months by 1.5 percentage points to 59.8% with market share gains being
achieved in all segments. Pleasingly our share of the growing premium beer
market has continued to increase assisted by our move to provide premium
products in bigger volume (660ml) packs.  Overall volume growth has been driven
by successful brand marketing, price point management and well-executed
promotions.

Price increases have been achieved with turnover increasing by 13% in local
currency, and rand-based turnover per hectolitre growing by around 10%, assisted
by favourable mix trends.  Manufacturing efficiencies were maintained at high
levels, and together with the increased volumes, this has led to a 16% increase
in South African rand EBITA, notwithstanding reduced export volumes. This result
has been enhanced by the strengthening of the rand, leading to a 35% increase in
reported EBITA over the prior year. EBITA margin of 22.7% reflects the benefits
from additional volume and cost efficiencies.

A new corporate branding campaign was launched during the period under review,
with the corporate advertisement, "Inspired by a nation", receiving positive
comments. At the same time, the Castle brand was relaunched with enhanced
packaging to an enthusiastic initial response.  At the recent Loerie awards,
South Africa's premier marketing and advertising awards, Beer South Africa was
recognised as the marketing organisation of the year.

The process to normalise the trade via the licensing of informal retailers in
most provinces is progressing slowly.  Development of a BEE (Black Economic
Empowerment) charter for the liquor manufacturing and distribution sector has
commenced. This involves key players in the liquor industry and is expected to
be completed in 2005.

CHIEF EXECUTIVE'S REVIEW  (continued)                                                                          12

Other Beverage Interests

                                                                        2004          2003      % change
Financial summary                                                       US$m          US$m

Turnover                                                                588           455            29
- ABI                                                                   455           353            29
EBITA £                                                                  68            42            65
- ABI                                                                    57            32            80
EBITA margin (%)£                                                      11.5           9.0
- ABI                                                                  12.5           9.0

Total sales volumes (hl 000s)                                         5,778         5,374             8
- ABI volumes                                                         5,675         5,261             8

£ Before exceptional profit of US$13 million on the disposal of trademarks in
2003.

Amalgamated Beverage Industries (ABI)

For the six months to 30 September 2004 ABI achieved a positive performance with
beverage volumes growing 8% to 5.67 million hls. Volume growth was supported by
successful promotions, increases in consumer disposable income and relatively
good weather conditions. Growth of PET packages has been strong during the
reporting period, as has growth of the 300 ml glass bottle pack.

EBITA increased by 80% to US$57 million, reflecting the benefits of higher
volumes, price increases, productivity gains and a strong rand/US dollar rate,
partially offset by increased container costs.

Our offer to acquire all of the shares in ABI which we do not already own, for a
cash consideration of R91.00 per share, was approved by the ABI minority
shareholders on 9 November 2004.  This will involve a total consideration of
approximately R3,800 million (US$585 million).  Application will be made to the
High Court of South Africa for the sanctioning of the scheme.

Appletiser

Total organic volumes in South Africa grew by over 30%, with resurgence in
demand and new pack sizes being introduced, and international volumes also grew.

Distell

Turnover in local currency grew by some 14% over the prior half year, driven by
strong international growth and a favourable sales mix, including good
performance in the spirits category.

CHIEF EXECUTIVE'S REVIEW  (continued)                                                                          13


Hotels and Gaming

                                                                        2004          2003      % change
Financial summary                                                       US$m          US$m

Turnover                                                                132           100            32
EBITA £                                                                  33            19            69
EBITA margin (%)£                                                      24.8          19.4

Revpar (US$) *                                                       $46.07        $37.79            22


£ Excludes exceptional profit of US$11 million on the disposal of fixed assets

* Revenue per available room

Since 31 March 2003, SABMiller has been a 49% shareholder in the Tsogo Sun group
(TSG). The business reported a strong first half performance and our share of
EBITA for the period was US$33 million.

The gaming market has continued to grow strongly, up 16% in the Gauteng
Province, reflecting buoyant consumer spending. Gaming has also benefited from
effective marketing initiatives, including two successful casino promotions.
Hotel occupancies were in line with prior year, and the growth in revpar in
local currency of 5% was enhanced by the strength of the rand against the US
dollar.

CHIEF EXECUTIVE'S REVIEW  (continued)                                                                          14

Financial review

Segmental analysis

Our operating results are set out in the segmental analysis of operations, and
the disclosures accord with the manner in which the group is managed. SABMiller
believes that the reported profit measures - before exceptional items and
amortisation of goodwill - provide additional and more meaningful information on
trends to shareholders and allow for greater comparability between segments.
Segmental performance is reported after the specific apportionment of
attributable head office service costs.

Accounting for volumes

In the determination and disclosure of reported sales volumes, the group
aggregates the volumes of all consolidated subsidiaries and its equity accounted
associates, other than associates where the group exercises significant
influence but primary responsibility for day to day management rests with others
(such as Castel and Distell). In these latter cases, the financial results of
operations are equity accounted in terms of UK GAAP but volumes are excluded.
Contract brewing volumes are excluded from total volumes; however turnover from
contract brewing is included within group turnover.  Reported volumes exclude
intra-group sales volumes.

New accounting standards and restatements

The reported turnover for the six months ended 30 September 2003 has been
restated following the adoption of FRS5 - Reporting the substance of
transactions, application note G - revenue recognition. The change reduced each
of turnover and net operating costs by US$126 million for the six months ended
30 September 2003 in respect of the following segments - US$53 million in North
America, US$47 million in Europe, US$17 million in Central America and US$9
million in Africa and Asia.  The reclassifications related respectively to
freight costs, distribution costs, and turnover-related taxes for the latter two
items.  In addition, each of turnover and net operating costs has been increased
by US$80 million in respect of the turnover of the Italian distribution
companies excluded at the prior half year.  There was no impact on EBITA.

The group has also adopted UITF 38 Accounting for ESOP trusts, which has
resulted in a reclassification of shares held in both employee share trusts and
the Safari Ltd investment, from other fixed asset investments, reducing net
assets by US$627 million at 30 September 2003.  This amount has been deducted in
arriving at shareholders' funds.  The revised UITF 17 Employee share schemes has
also been adopted.  The reported profits for the six months ended 30 September
2003 were reduced by US$1 million as a result.

Organic, constant currency comparisons

The group has made some disclosures of its results on an organic, constant
currency basis, to analyse the effects of acquisitions net of disposals and
changes in exchange rates on the group's results.  Organic results exclude the
first twelve months' results of acquisitions and the last twelve months' results
of disposals.  Constant currency results have been determined by translating the
local currency denominated results for the six months ended 30 September 2004 at
the exchange rates for the comparable period in the prior year.

Acquisitions

The acquisition of a 94.93% interest in SC Aurora SA in Romania was completed on
10 June 2004, with the holding increased to 99.58% subsequently.  The
acquisition was funded in cash from existing resources.


CHIEF EXECUTIVE'S REVIEW  (continued)                                                                          15

Profit before tax

Profit before tax of US$1,196 million was up 80% on prior period, reflecting
performance improvements from all our business segments, the impact of
favourable exchange rates, and the impact of exceptional items as described
below.

Exceptional items

The group recorded net exceptional costs within operating profit of US$19
million, being US$23 million brewery closure costs in Italy and US$4 million
profit on the disposal of the Tumwater brewery at Miller.  Exceptional profits
of US$346 million were recorded after operating profit and comprised US$96
million profit on the disposal of the group's 29.4% stake in Harbin Brewery
Group Limited (Harbin), US$239 million profit on the disposal of the group's 21%
investment in Edgars Consolidated Stores Ltd (Edcon) and US$11 million share of
associate's profit on the disposal of fixed assets in Hotels and Gaming.

This compares to prior period exceptional costs within operating profit of US$15
million, comprising integration and restructuring costs of US$13 million within
Miller, and Central America restructuring costs of US$2 million.  Exceptional
profits of US$58 million were recorded after operating profit in the prior
period and comprised the surplus on the pension fund of a disposed operation of
US$45 million and the profit on the disposal of trademarks in Appletiser of
US$13 million.

Treasury

Gross borrowings have decreased marginally to US$3,680 million from US$3,707
million at 31 March 2004.  Net debt has decreased to US$2,401 million from
US$3,025 million at 31 March 2004 reflecting the increase in cash generated from
operating activities and from the disposal of investments. The group's gearing
has decreased to 31.6% from last March's 43.3%.

The average loan maturity in respect of the US$ fixed rate debt portfolio is 4.9
years.  The average borrowing rate for the total debt portfolio at 30 September
2004 was 5.1% (2003: 5.3%).

In April 2004 SABMiller plc and SABMiller Finance BV signed a five-year US$1,000
million revolving credit bank facility agreement.  This replaced the US$720
million facility in existence at 31 March 2004.

Interest

Net interest costs increased to US$91 million, a 3% increase on the prior
period's US$88 million, due primarily to the effects of a full six months'
higher interest rates payable on the fixed debt issued in August 2003.

Taxation

The effective tax rate, before goodwill amortisation and exceptional items, is
34.8%, broadly in line with the prior period and our expectation for the full
year.

Goodwill

Intangible assets decreased by US$126 million compared to 31 March 2004, due
primarily to the amortisation charge for the period of US$173 million partly
offset by foreign exchange movements and the goodwill arising on acquisitions.
Goodwill in ABI is considered to have an indefinite life (consistent with prior
years), all other goodwill being amortised over 20 years.

Cash flow

Net cash inflow from operating activities before working capital movement
(EBITDA) rose to US$1,282 million from last half year's US$1,034 million. The
ratio of EBITDA to group turnover increased in the period to 19.9% (2003: 18.2%
restated).


CHIEF EXECUTIVE'S REVIEW  (continued)                                                                          16

Dividend

The board has declared an interim dividend of 12.0 US cents per share.  The
dividend will be payable on   20 December 2004 to all shareholders registered on
the London and Johannesburg Registers on 3 December 2004. The ex-dividend
trading dates will be 1 December 2004 on the London Stock Exchange and 29
November 2004 on the JSE Securities Exchange South Africa.  As the group reports
in US dollars, dividends are declared in US dollars. They are payable in
sterling to shareholders on the UK section of the register and in South African
rand to shareholders on the RSA section of the register. The rates of exchange
applicable on 12 November 2004, being the last practical date before the
declaration date, will be used for conversion ($/£ = 1.8499 and R/$ = 6.1189),
resulting in an equivalent interim dividend of 6.487 UK pence per share for UK
shareholders and 73.4268 SA cents per share for RSA shareholders.

To comply with the requirements of STRATE in South Africa, from the close of
business on 26 November 2004 until the close of business on 3 December 2004, no
transfers between the UK and South African Registers will be permitted and no
shares may be dematerialised or rematerialised.


DIRECTORS' RESPONSIBILITY FOR FINANCIAL REPORTING                                                               17

This statement, which should be read in conjunction with the independent review
report of the auditors set out below, is made to enable shareholders to
distinguish the respective responsibilities of the directors and the auditors in
relation to the consolidated interim financial information, set out on pages 18
to 32, which the directors confirm has been prepared on a going concern basis
and follows all applicable accounting standards. The directors consider that the
group has used appropriate accounting policies, consistently applied and
supported by reasonable and prudent judgements and estimates.

A copy of the interim report of the group is placed on the company's website.
The directors are responsible for the maintenance and integrity of information
on the company's website.  Information published on the internet is accessible
in many countries with different legal requirements.  Legislation in the United
Kingdom governing the preparation and dissemination of the financial statements
may differ from legislation in other jurisdictions.

On behalf of the board

E A G Mackay                                                    M I Wyman
Chief Executive                                                 Chief Financial Officer

18 November 2004


INDEPENDENT REVIEW REPORT TO SABMILLER plc

Introduction

We have been instructed by the company to review the financial information which
comprises the profit and loss account, the statement of total recognised gains
and losses, the balance sheet, the cash flow statement, comparative figures and
associated notes. We have read the other information contained in the interim
report and considered whether it contains any apparent misstatements or material
inconsistencies with the financial information.

Directors' responsibilities

The interim report, including the financial information contained therein, is
the responsibility of, and has been approved by the directors. The directors are
responsible for preparing the interim report in accordance with the Listing
Rules of the Financial Services Authority which require that the accounting
policies and presentation applied to the interim figures should be consistent
with those applied in preparing the preceding annual accounts except where any
changes, and the reasons for them, are disclosed.

Review work performed

We conducted our review in accordance with guidance contained in Bulletin 1999/4
issued by the Auditing Practices Board for use in the United Kingdom. A review
consists principally of making enquiries of group management and applying
analytical procedures to the financial information and underlying financial
data, and based thereon, assessing whether the accounting policies and
presentation have been consistently applied unless otherwise disclosed.

A review excludes audit procedures such as tests of controls and verification of
assets, liabilities and transactions. It is substantially less in scope than an
audit performed in accordance with United Kingdom Auditing Standards and
therefore provides a lower level of assurance than an audit. Accordingly we do
not express an audit opinion on the financial information.

This report has been prepared for and only for the company for the purpose of
the Listing Rules of the Financial Services Authority and for no other purpose.
We do not, in producing this report, accept or assume responsibility for any
other purpose or to any other person to whom this report is shown or into whose
hands it may come save where expressly agreed by our prior consent in writing.

Review conclusion

On the basis of our review we are not aware of any material modifications that
should be made to the financial information as presented for the six months
ended 30 September 2004.

PricewaterhouseCoopers LLP
Chartered Accountants

London
18 November 2004


SABMiller plc
CONSOLIDATED PROFIT AND LOSS ACCOUNTS
for the six months ended 30 September                                                                          18






                                                        Six months          Six months                   Year ended
                                                        ended 30/9          ended 30/9                      31/3/04
                                                               /04                 /03
                                                                              Restated
                                                         Unaudited           Unaudited                      Audited
                                               Notes          US$m                US$m                         US$m

Turnover (including share of associates'         2          7,178               6,282                       12,645
turnover)
Less: share of associates' turnover                          (735)               (585)                      (1,279)

Group turnover                                   2          6,443               5,697                       11,366
Net operating costs                                        (5,625)             (5,085)                     (10,043)

Group operating profit                           2            818                 612                        1,323
Share of operating profit of associates          2            123                  83                          189
Profit on disposal of investments                3            335                   -                            -
Share of associate's profit on disposal of       3             11                   -                            -
fixed assets
Profit on disposal of trademarks                 3              -                  13                           13
Surplus on pension fund of disposed operation    3              -                  45                           47
Share of associate's profit on disposal of CSD   3              -                   -                            7
business and brands in Morocco and a brand in
Angola

Profit on ordinary activities before interest               1,287                 753                        1,579
and taxation
Net interest payable                                          (91)                (88)                        (188)
Group                                                         (78)                (71)                        (152)
Associates                                                    (13)                (17)                         (36)


Profit on ordinary activities before taxation               1,196                 665                        1,391
Taxation on profit on ordinary activities        4           (397)               (271)                        (579)

Profit on ordinary activities after taxation                  799                 394                          812
Equity minority interests                                    (100)                (86)                        (167)
Profit for the financial period                               699                 308                          645

Basic earnings per share (US cents)              5           58.5                25.8                         54.1
Headline earnings per share (US cents)           5           48.8                34.6                         76.7
Adjusted basic earnings per share (US cents)     5           48.8                35.4                         77.6
Diluted earnings per share (US cents)            5           56.0                25.3                         53.0
Adjusted diluted earnings per share (US cents)   5           46.8                34.3                         75.2
Dividend per share (US cents)                                12.0                 7.5                         30.0






SABMiller plc
CONSOLIDATED BALANCE SHEETS
at 30 September                                                                                                19






                                                        30/9/04              30/9/03                        31/3/04
                                                                            Restated
                                                      Unaudited            Unaudited                        Audited
                                                           US$m                 US$m                           US$m

Fixed assets
Intangible assets                                        6,387                6,645                          6,513
Tangible assets                                          3,835                3,617                          3,758
Investments                                              1,211                1,065                          1,212
Investments in associates                                1,041                1,029                            928
Other fixed asset investments                              170                   36                            284

                                                        11,433               11,327                         11,483

Current assets
Stock                                                      607                  557                            599
Debtors                                                  1,155                1,046                          1,035
Investments                                                379                   17                             31
Cash at bank and in hand                                   900                  586                            651
                                                         3,041                2,206                          2,316

Creditors - amounts falling due within one              (2,793)              (2,662)                        (2,783)
year
Interest bearing debt                                     (507)                (850)                          (613)
Other                                                   (2,286)              (1,812)                        (2,170)


Net current assets/(liabilities)                           248                 (456)                          (467)

Total assets less current liabilities                   11,681               10,871                         11,016

Creditors - amounts falling due after one year          (3,236)              (3,163)                        (3,166)
Interest bearing debt *                                 (3,173)              (3,097)                        (3,094)
Other                                                      (63)                 (66)                           (72)

Provisions for liabilities and charges                    (836)                (862)                          (866)
Net assets                                               7,609                6,846                          6,984

Shareholders' funds                                      6,775                6,010                          6,165
Equity minority interests                                  834                  836                            819
Capital employed                                         7,609                6,846                          6,984




* Includes US$596 million (30/9/03: US$592 million, 31/3/04: US$594 million)
4.25% guaranteed convertible bonds.






SABMiller plc
CONSOLIDATED CASH FLOW STATEMENTS
for the six months ended 30 September                                                                          20






                                                       Six months           Six months                   Year ended
                                                     ended 30/9/04       ended 30/9/03                     31/3/04
                                                         Unaudited           Unaudited                      Audited
                                               Notes          US$m                US$m                         US$m

Net cash inflow from operating activities        6          1,262               1,088                        2,292

Dividends received from associates                             21                  11                           25

Returns on investments and servicing of
finance
Interest received                                              45                  20                           53
Interest paid                                                (114)                (72)                        (216)
Interest element of finance lease rental                       (1)                 (1)                          (3)
payments
Dividends received on other investments                        10                   3                            9
Dividends paid to minority interests                          (76)                (85)                        (154)

Net cash outflow from returns on investments
and servicing
of finance                                                   (136)               (135)                        (311)

Taxation paid                                                (272)               (244)                        (456)

Capital expenditure and financial investments
Purchase of tangible fixed assets                            (338)               (258)                        (576)
Sale of tangible fixed assets                                  12                  14                           27
Purchase of investments                                        (5)                 (4)                        (217)
Sale of investments                                           463                   6                            6

Net cash inflow/(outflow) for capital                         132                (242)                        (760)
expenditure and financial investments

Acquisitions and disposals

Purchase of subsidiary undertakings                           (25)               (331)                        (338)
Net cash/(overdraft) acquired with subsidiary                   1                 (98)                        (160)
undertaking
Sale of subsidiary undertakings                                 -                  30                            -
Net cash disposed with subsidiary undertakings                  -                  (8)                           -
Purchase of shares from minorities                              -                 (16)                         (20)
Purchase of shares in associates                               (8)               (247)                         (58)
Proceeds from pension fund of disposed                          -                  45                           47
operation
Proceeds from disposal of trademarks                            -                  13                           13
Net funding (to)/from  associates                             (59)                  1                            1

Net cash outflow for acquisitions and                         (91)               (611)                        (515)
disposals

Equity dividends paid to shareholders                        (269)               (219)                        (309)


Management of liquid resources
Sale/(purchase) of short-term liquid                            5                   -                          (16)
instruments
Cash placed in short-term deposits                           (353)                (15)                           -

Net cash outflow from management of liquid                   (348)                (15)                         (16)
resources

Financing
Issue of shares                                                19                   1                           10
Issue of shares to minorities                                   1                   2                            4
Purchase of own shares                                         (5)                  -                          (10)
New loans raised                                              527               2,711                        3,385
Repayment of loans                                           (579)             (2,468)                      (3,377)
Net cash (outflow)/inflow from financing                      (37)                246                           12

Increase/(decrease) in cash in the period        7            262                (121)                         (38)



SABMiller plc
CONSOLIDATED STATEMENTS OF TOTAL RECOGNISED GAINS AND LOSSES
for the six months ended 30 September                                                                            21






                                                        Six months          Six months                   Year ended
                                                     ended 30/9/04       ended 30/9/03                      31/3/04
                                                                              Restated
                                                         Unaudited           Unaudited                      Audited
                                                              US$m                US$m                         US$m

Profit for the financial period                               699                 308                          645
Currency translation differences on foreign currency           38                 216                          300
net investments
Other movements                                                 -                  (1)                           -
Total recognised gains and losses for the period              737                 523                          945




CONSOLIDATED RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS
for the six months ended 30 September


                                                        Six months          Six months                   Year ended
                                                     ended 30/9/04       ended 30/9/03                      31/3/04
                                                                              Restated
                                                         Unaudited           Unaudited                      Audited
                                                              US$m                US$m                         US$m

Profit for the financial period                               699                 308                          645
Other recognised gains and losses relating to the              38                 215                          300
period (net)
Net proceeds on ordinary shares issued for cash                19                   1                           10
Dividends declared by SABMiller plc                          (144)                (89)                        (358)
Payments for purchase of own shares for share trusts           (5)                  -                          (10)
Credit entry re the charge in respect of share                  3                   3                            6
option schemes

Net increase in shareholders' funds                           610                 438                          593

Shareholders' funds at start of period                      6,165               5,572                        5,572

Shareholder's funds at start of year as previously          6,165               6,201                        5,572
reported
Prior year adjustment in respect of adoption of UITF            -                (629)                           -
38

Shareholders' funds at end of period                        6,775               6,010                        6,165



SABMiller plc
NOTES TO THE FINANCIAL STATEMENTS                                                                              22


1.  Basis of preparation

The consolidated financial statements have been prepared under the historical
cost convention in accordance with Accounting Standards applicable in the United
Kingdom, and, on the basis of the accounting policies, as set out in note 2 of
the 2004 annual report.  The prior half year  comparatives have been restated to
reflect changes in accounting policies for turnover, ESOP trusts and other
similar trusts and employee share schemes as adopted in the 2004 annual report.
The impact of the changes is described below.

FRS 5 Reporting the substance of transactions, application note G - revenue
recognition was issued in November 2003.  As a result, certain costs previously
included within net operating costs have been reclassified as deductions from
turnover.  The restatement reduced each of turnover and net operating costs by
US$126 million for the six months ended 30 September 2003 in respect of the
following segments - US$53 million in North America, US$47 million in Europe,
US$17 million in Central America and US$9 million in Africa and Asia.  The
reclassification related respectively to freight costs, distribution costs, and
turnover-related taxes for the latter two items.  In addition, each of turnover
and net operating costs has been increased by US$80 million in respect of the
turnover of the Italian distribution companies excluded at the prior half year.
There was no impact on profit.

The Urgent Issues Task Force Abstract 38 Accounting for ESOP trusts (UITF 38)
was issued in December 2003.  UITF 38 requires shares held by ESOP trusts to be
treated as a deduction in arriving at shareholders' funds, rather than as a
fixed asset investment.  Shares held by the employee share trusts have been
restated.  Further, following the principles of UITF 38, the SABMiller plc
shares held by Safari Ltd, a special purpose vehicle, have been reclassified
similarly.  Net assets have thus been reduced by US$629 million as at 31 March
2003 and US$627 million as at 30 September 2003.

Simultaneously with the issue of UITF 38, UITF 17 Employee share schemes was
revised.  The revised UITF 17 requires that the charge to the profit and loss
account in relation to share awards be based on the fair value of the shares at
the date of grant (the market value) less any contribution towards the cost of
the shares.  The amount recognised is spread over the period to which any
performance criteria relate.  The effect of uncertainty as to whether any
performance criteria will be met is dealt with by estimating the probability of
shares vesting.  The profit for the six months ended 30 September 2003 has
decreased by US$1 million as a result of this revision.

The cumulative effect of adopting these changes relating to previous periods has
been recognised in the financial statements as a prior period adjustment and
comparative figures for the six months ended 30 September 2003 have been
restated accordingly.  The effect of these changes is as follows:

                                                                            Six months
                                                                                ended
                                                                         30 September 2003
                                                                                      US$m
Decrease in turnover                                                                  (46)
Decrease in net operating costs                                                        45
Impact on operating profit                                                             (1)

Decrease in shareholders' funds at the beginning of the period                       (629)
Effect on profit for the financial period                                              (1)
Credit entry re the charge in respect of share option schemes                           3
Decrease in shareholders' funds at the end of the period                             (627)

The group financial statements consolidate those of the company and all of its
subsidiary undertakings together with the attributable share of the results of
associated undertakings. The principal subsidiary and associated undertakings
are all coterminous with those of the company, except for the group's
significant associated undertaking, Distell Group, which has a statutory
accounting reference date of 30 June and is therefore accounted for three months
in arrears.

The financial information in this report does not constitute statutory accounts
within the meaning of s240 of the Companies Act 1985 (as amended).


SABMiller plc
NOTES TO THE FINANCIAL STATEMENTS                                                                              23


2.  Segmental analysis

                                                        Six months          Six months                   Year ended
Turnover                                             ended 30/9/04       ended 30/9/03                      31/3/04
                                                                              Restated
                                                         Unaudited           Unaudited                      Audited
                                                              US$m                US$m                         US$m

Business segment analysis

Americas:

North America                                               2,615               2,526                        4,778

Central America                                               260                 265                          531

Europe                                                      1,617               1,370                        2,420


Africa and Asia                                               870                 735                        1,555
Associates' share                                            (427)               (342)                        (691)
                                                              443                 393                          864
South Africa:

Beer South Africa                                           1,096                 831                        1,964

Other Beverage Interests                                      588                 455                        1,171
Associates' share                                            (176)               (143)                        (362)
                                                              412                 312                          809

Hotels and Gaming                                             132                 100                          226
Associates' share                                            (132)               (100)                        (226)
                                                                -                   -                            -


Group                                                       7,178               6,282                       12,645
Associates' share                                            (735)               (585)                      (1,279)
                                                            6,443               5,697                       11,366



SABMiller plc
NOTES TO THE FINANCIAL STATEMENTS (continued)                                                                   24


2.  Segmental analysis (continued)

                                                        Six months          Six months                   Year ended
Operating profit                                     ended 30/9/04       ended 30/9/03                      31/3/04
                                                                              Restated
                                                         Unaudited           Unaudited                      Audited
                                                              US$m                US$m                         US$m

Business segment analysis



Americas:

North America                                                 189                 132                          189

Central America                                                15                   9                           31

Europe                                                        270                 229                          327


Africa and Asia                                               168                 123                          288
Associates' share                                             (73)                (51)                        (101)
                                                               95                  72                           187
South Africa:
Beer South Africa                                             249                 184                          522

Other Beverage Interests                                       68                  42                          186
Associates' share                                             (18)                (13)                         (36)
                                                               50                  29                          150

Hotels and Gaming                                              32                  19                           52
Associates' share                                             (32)                (19)                         (52)
                                                                -                   -                            -

Central administration                                        (31)                (28)                         (57)

Group - excluding exceptional items                           960                 710                        1,538
Associates' share                                            (123)                (83)                        (189)
                                                              837                 627                        1,349
Exceptional items

North America                                                   4                 (13)                         (14)
Central America                                                 -                  (2)                          (6)
Europe                                                        (23)                  -                           (6)

Group - including exceptional items                           941                 695                        1,512

Associates' share                                            (123)                (83)                        (189)
                                                              818                 612                        1,323



SABMiller plc
NOTES TO THE FINANCIAL STATEMENTS (continued)                                                                   25



2.  Segmental analysis (continued)


                                                        Six months          Six months                   Year ended

EBITA                                                ended 30/9/04       ended 30/9/03                      31/3/04
                                                                              Restated
                                                         Unaudited           Unaudited                      Audited
                                                              US$m                US$m                         US$m

Business segment analysis



Americas:

North America                                                 306                 249                          424

Central America                                                37                  32                           76

Europe                                                        300                 256                          383


Africa and Asia                                               179                 134                          306
Associates' share                                             (80)                (58)                        (112)
                                                               99                  76                          194

South Africa:
Beer South Africa                                             249                 184                          522

Other Beverage Interests                                       68                  42                          186
Associates' share                                             (18)                (13)                         (36)
                                                               50                  29                          150

Hotels and Gaming                                              33                  19                           53
Associates' share                                             (33)                (19)                         (53)
                                                                -                   -                            -

Central administration                                        (31)                (28)                         (57)

Group - excluding exceptional items                         1,141                 888                        1,893
Associates' share                                            (131)                (90)                        (201)
                                                            1,010                 798                        1,692
Exceptional items

North America                                                   4                 (13)                         (14)
Central America                                                 -                  (2)                          (6)
Europe                                                        (23)                  -                           (6)
Africa and Asia                                                96                   -                            7
OBI (Appletiser)                                                -                  13                           13
Hotels and Gaming                                              11                   -                            -
Central administration                                        239                  45                           47

Group - including exceptional items                         1,468                 931                        1,934

Associates' share                                            (142)                (90)                        (208)
                                                            1,326                 841                        1,726






SABMiller plc
NOTES TO THE FINANCIAL STATEMENTS (continued)                                                                   26







2.  Segmental analysis (continued)


                                                        Six months          Six months                   Year ended
EBITDA                                               ended 30/9/04       ended 30/9/03                      31/3/04
                                                         Unaudited           Unaudited                      Audited
                                                              US$m                US$m                         US$m

Business segment analysis



Americas:

North America                                                 371                 322                          567

Central America                                                57                  53                          113

Europe                                                        378                 323                          526


Africa and Asia                                               116                  93                          232

South Africa:
Beer South Africa                                             312                 226                          619

Other Beverage Interests                                       73                  45                          192

Hotels and Gaming                                               -                   -                            -

Central administration                                        (29)                (25)                         (50)

Group - excluding exceptional items                         1,278               1,037                        2,199

Exceptional items

North America                                                   4                  (1)                          (6)
Central America                                                 -                  (2)                          (6)
Europe                                                          -                   -                           (2)

Group - including exceptional items                         1,282               1,034                        2,185



SABMiller plc
NOTES TO THE FINANCIAL STATEMENTS (continued)                                                                   27



3.  Exceptional items

The following items were treated as exceptional items by the group during the
six months ended 30 September:

                                                        Six months          Six months                   Year ended
                                                     ended 30/9/04       ended 30/9/03                      31/3/04
                                                         Unaudited           Unaudited                      Audited
                                                              US$m                US$m                         US$m

Recognised in operating profit:
North America                                                   4                 (13)                         (14)

Profit on disposal of Tumwater brewery                          4                   -                            -
Miller integration and restructuring costs                      -                 (13)                         (13)
Brewery closure costs in Tumwater                               -                   -                            4
Asset impairment                                                -                   -                           (5)

Central America

Reorganisation costs                                            -                  (2)                          (6)


Europe                                                        (23)                  -                           (6)

Brewery closure costs in Italy                                (23)                  -                            -
Water plant closure costs in the Canary Islands                 -                   -                           (6)

                                                              (19)                (15)                         (26)

Taxation (charge)/credit                                       (2)                  6                            7
Minority interests' share of the above items                    -                   1                            5


The US$4 million (2003: US$nil) exceptional item is the group's profit on the
sale of the Tumwater brewery in North America which was completed in April 2004.

Following the acquisition of Birra Peroni in Italy, an operating review resulted
in management announcing in October 2004 the closure of the Naples brewery.  As
a result, the tangible fixed assets have been written down to net recoverable
value, resulting in an impairment charge of US$23 million.  Further costs
relating to the closure of the brewery and the wider operational review are
anticipated in the second half of the year.

SABMiller plc
NOTES TO THE FINANCIAL STATEMENTS (continued)                                                                   28

3.  Exceptional items (continued)

                                                        Six months          Six months                   Year ended
                                                     ended 30/9/04       ended 30/9/03                      31/3/04
                                                         Unaudited           Unaudited                      Audited
                                                              US$m                US$m                         US$m

Recognised after operating profit:
Africa and Asia                                                96                   -                            7

Profit on disposal of investment                               96                   -                            -
Share of associate's profit on disposal of CSD                  -                   -                            6
business and brands in Morocco
Share of associate's profit on disposal of a brand              -                   -                            1
in Angola

Other Beverage Interests (Appletiser)

Profit on disposal of trademarks                                -                  13                           13


Hotels and Gaming

Share of associate's profit on disposal of fixed               11                   -                            -
assets

Central Administration                                        239                  45                           47

Profit on disposal of investment                              239                   -                            -
Surplus on pension fund of disposed operation                   -                  45                           47

                                                              346                  58                           67

Taxation                                                      (29)                 (1)                          (1)

The sale of the group's 29.4% interest in Harbin Brewery Group Limited (Harbin)
was completed in June 2004, realising a profit of US$96 million, after taking
into account all associated costs.

In May 2004, Tsogo Sun Holdings (Pty) Ltd (Tsogo Sun) recorded an exceptional
pre-tax profit on sale of two Umhlanga Rocks hotels, of which the group's share
amounted to US$11 million.

In July 2004, the group disposed of its entire 21% interest in Edgars
Consolidated Stores Ltd (EdCon) realising a pre-tax profit of US$239 million.
The associated capital gains tax amounted to US$29 million.

SABMiller plc
NOTES TO THE FINANCIAL STATEMENTS (continued)                                                                   29

4.  Taxation on profit on ordinary activities

                                                        Six months          Six months                   Year ended
                                                     ended 30/9/04       ended 30/9/03                      31/3/04
                                                                              Restated
                                                         Unaudited           Unaudited                      Audited
                                                              US$m                US$m                         US$m

Current taxation                                              301                 252                          507
(Under)/over provision in respect of prior year                (1)                  1                            1
Withholding  and other taxes                                   43                   8                           22
Share of associates' taxation charge                           32                  16                           45
Deferred taxation                                              22                  (6)                           4
                                                              397                 271                          579

Effective tax rate, before goodwill amortisation and         34.8                34.6                         34.3
exceptional items (%)

5.  Earnings per share

                                                        Six months          Six months                   Year ended
                                                     ended 30/9/04       ended 30/9/03                   31/3/04
                                                                              Restated
                                                         Unaudited           Unaudited                      Audited
                                                          US cents            US cents                     US cents

Basic earnings per share                                     58.5                25.8                         54.1

Headline earnings per share                                  48.8                34.6                         76.7

Adjusted basic earnings per share                            48.8                35.4                         77.6

Diluted earnings per share                                   56.0                25.3                         53.0

Adjusted diluted earnings per share                          46.8                34.3                         75.2


The calculation of basic earnings per share has been based on the profit for the
financial period as shown below, and on a weighted average number of shares in
issue of 1,193,753,551 (2003: 1,191,857,007).

At 30 September 2004 there were 11,949,314 share options outstanding under the
SABMiller plc Executive Share Purchase Scheme (South Africa), 8,571,968 share
purchase options outstanding under the SABMiller plc Executive Share Option
Scheme (Approved Scheme and (No 2) Scheme combined), 2,903,629 share purchase
options outstanding under SABMiller plc International Employee Share Scheme and
2,514,132 conditional awards under the SABMiller plc Performance Share Awards
Scheme which have not yet vested.  The calculation of diluted earnings per share
is based on a weighted average number of shares in issue of 1,271,325,003 after
adjusting for 77,571,452 weighted potentially dilutive ordinary shares arising
from the share options and the guaranteed convertible bond, and the profit for
the financial period as shown below, adjusted for an interest saving of US$13
million on the 4.25% guaranteed convertible bond. The average share price of
SABMiller plc since the beginning of the financial year, used in determining the
number of potentially dilutive ordinary shares, is US$12.15, compared with an
average strike price on the outstanding options of US$8.35.

The group has also presented an adjusted basic earnings per share figure to
exclude the impact of amortisation and other non-recurring items in order to
present a more meaningful comparison for the years shown in the consolidated
financial statements. Adjusted basic earnings per share has been based on
adjusted headline earnings for each financial year and on the same number of
weighted average shares in issue as the basic earnings per share calculation.
Headline earnings per share has been calculated in accordance with the Institute
of Investment Management and Research (IIMR)'s Statement of Investment Practice
No. 1 entitled 'The Definition of Headline Earnings'.  The adjustments made to
arrive at headline earnings and adjusted earnings are as follows:


SABMiller plc
NOTES TO THE FINANCIAL STATEMENTS (continued)                                                                   30

5.  Earnings per share (continued)

                                                        Six months          Six months                   Year ended
                                                     ended 30/9/04       ended 30/9/03                      31/3/04
                                                                              Restated
                                                         Unaudited           Unaudited                      Audited
                                                              US$m                US$m                         US$m

Profit for the financial period                               699                 308                          645
Amortisation of goodwill                                      181                 178                          355
Share of associate's profit on disposal of fixed              (11)                  -                            -
assets (Hotels and Gaming)
Profit on sale of investments (Africa and Asia,              (335)                  -                            -
Central Administration)
Profit on disposal of Tumwater (North America)                 (4)                  -                            -
Brewery closure costs in Italy (Europe)                        23                   -                            -
Profit on disposal of trademarks (Appletiser, Other             -                 (13)                         (13)
Beverage Interests)
Share of associate's profit on disposal of Moroccan             -                   -                           (7)
business and an Angolan brand (Africa and Asia)
Surplus on pension fund of disposed entity                      -                 (45)                         (47)
Brewery closure costs in Tumwater (North America)               -                   -                           (4)
Asset impairment (North America)                                -                   -                            5
Water plant closure costs in the Canary Islands                 -                   -                            6
(Europe)
Share of associates profit for compensation for                 -                   -                           (2)
cancellation of distribution rights
Loss/(profit) on sale of fixed assets                           9                  (4)                           3
Tax effects of the above items                                 31                   1                            -
Minority interests' share of the above items                  (10)                (11)                         (26)
Headline earnings (basic)                                     583                 414                          915
Integration/reorganisation costs                                -                  15                           19
Tax effects of the above items                                  -                  (6)                          (7)
Minority interests' share of the above items                    -                  (1)                          (2)
Adjusted earnings                                             583                 422                          925





SABMiller plc
NOTES TO THE FINANCIAL STATEMENTS (continued)                                                                   31


6.  Reconciliation of operating profit to net cash inflow from operating
activities


                                                        Six months          Six months                   Year ended
                                                     ended 30/9/04       ended 30/9/03                      31/3/04
                                                                              Restated
                                                         Unaudited           Unaudited                      Audited
                                                              US$m                US$m                         US$m

Operating profit                                              818                 612                        1,323
Depreciation: Tangible fixed assets                           212                 187                          387
Depreciation: Containers                                       40                  34                           73

Container breakages and shrinkage                              13                  15                           19

Amortisation of intangible fixed assets                       173                 171                          343

Dividends received from other investments                     (10)                 (3)                          (9)
Brewery closure costs in Italy(Europe)                         23                   -                            -
Loss/(profit) on sale of fixed assets                           9                  (3)                           3
Charge with respect to share options                            3                   3                            6
North America integration costs                                 -                  12                            7
Brewery closure costs in Tumwater (North America)               -                   -                           (4)
Asset impairment (North America)                                -                   -                            5
Water plant closure costs (Europe)                              -                   -                            4
Deferred income                                                (1)                 (1)                          (1)
Other non-cash movements                                        2                   7                           29

Net cash inflow from operating activities before
working
capital movements (EBITDA)                                  1,282               1,034                        2,185
Increase in stock                                              (5)                (12)                         (47)
(Increase)/decrease in debtors                               (131)                (56)                          48
Increase in creditors                                         116                 122                          106
Net cash inflow from operating activities                   1,262               1,088                        2,292



Operating cash flows include cash inflow relating to exceptional items of US$4
million on respect of profit on disposal of Tumwater (North America), US$nil
million (30/9/03: US$1 million outflow; 31/3/04 US$6 million outflow) in respect
of North America restructuring and integration costs, US$nil million (30/9/03:
US$2 million outflow; 31/3/04: US$6 million outflow) in respect of
reorganisation costs in Central America and US$nil million (31/3/04: US$2
million) in respect of water plant closure costs in Europe.  There were no cash
flows associated with the brewery closure costs in Italy.

7.  Reconciliation of net cash flow to movement in net debt


                                                        Six months          Six months                   Year ended
                                                     ended 30/9/04       ended 30/9/03                      31/3/04
                                                         Unaudited           Unaudited                      Audited
                                                              US$m                US$m                         US$m

Increase/(decrease) in cash                                   262                (121)                         (38)
Net cash outflow/(inflow) from decrease/(increase)
in debt and lease
financing                                                      52                (243)                          (8)
Cash outflow from increase in liquid resources                348                  15                           16

Change in net debt resulting from cash flows                  662                (349)                         (30)
Loans and finance leases acquired with subsidiary               -                (110)                         (82)
undertakings
Loans and finance leases disposed with subsidiary               -                  29                            -
undertakings
Loans and finance leases reclassified to fixed asset            -                   -                            9
investments
Exchange movements                                            (35)                 (5)                          (7)
Cash inflow from interest rate hedges                           -                  56                           56
Amortisation of bond costs                                     (3)                 (3)                          (9)

Movement in net debt in the period                            624                (382)                         (63)
Opening net debt                                           (3,025)             (2,962)                      (2,962)
Closing net debt                                           (2,401)             (3,344)                      (3,025)



SABMiller plc
NOTES TO THE FINANCIAL STATEMENTS (continued)                                                                   32



8.  Post-balance sheet event

The group's offer, by means of a scheme of arrangement, to acquire the 26.5% of
the issued share capital of ABI that it does not already own for cash
consideration of R91 per share was approved by the requisite majority of ABI's
minority shareholders on 9 November 2004.  Application will be made shortly to
the court to sanction the scheme.

SABMiller plc
FORWARD LOOKING STATEMENTS                                                                                     33


This announcement does not constitute an offer to sell or issue or the
solicitation of an offer to buy or acquire ordinary shares in the capital of
SABMiller plc (the "Company") or an inducement to enter into investment activity
in any jurisdiction.

This announcement includes "forward-looking statements".  These statements may
contain the words "anticipate", "believe", "intend", "estimate", "expect" and
words of similar meaning.  All statements other than statements of historical
facts included in this announcement, including, without limitation, those
regarding the Company's financial position, business strategy, plans and
objectives of management for future operations (including development plans and
objectives relating to the Company's products and services) are forward-looking
statements.  Such forward-looking statements involve known and unknown risks,
uncertainties and other important factors that could cause the actual results,
performance or achievements of the Company to be materially different from
future results, performance or achievements expressed or implied by such
forward-looking statements.  Such forward-looking statements are based on
numerous assumptions regarding the Company's present and future business
strategies and the environment in which the Company will operate in the future.
These forward-looking statements speak only as at the date of this announcement.
  The Company expressly disclaims any obligation or undertaking to disseminate
any updates or revisions to any forward-looking statements herein to reflect any
change in the Company's expectations with regard thereto or any change in
events, conditions or circumstances on which any such statement is based.


SABMiller plc
ADMINISTRATION                                                                                                 34

SABMiller plc
(Registration No. 3528416)

Company Secretary
A O C Tonkinson

Registered Office
Dukes Court, Duke Street
Woking
Surrey, England
GU21 5BH
Telefax     +44 1483 264103
Telephone +44 1483 264000

Head Office
One Stanhope Gate
London, England
 W1K 1AF
Telefax      +44 20 7659 0111
Telephone +44 20 7659 0100

Internet address
http://www.sabmiller.com

Investor Relations
investor.relations@sabmiller.com
Telephone +44 20 7659 0100

Independent Auditors
PricewaterhouseCoopers LLP
1 Embankment Place
London, England
WC2N 6RH

Telefax +44 20 7822 4652
Telephone +44 20 7583 5000

Registrar (United Kingdom)
Capita Registrars
The Registry
34 Beckenham Road
Beckenham
 Kent, England
BR3 4TU

Telefax +44 20 8658 3430
Telephone +44 20 8639 2157 (outside UK)
Telephone 0870 162 3100 (from UK)

Registrar (South Africa)
Computershare Investor Services 2004 (Pty) Limited
70 Marshall Street, Johannesburg

PO Box 61051
Marshalltown 2107
South Africa
Telefax    +27 11 370 5487
Telephone +27 11 370 5000

United States ADR Depositary
The Bank of New York
ADR Department
101 Barclay Street
New York, NY 10286
United States of America
Telefax +1 212 815 3050
Telephone +1 212 815 2051

Internet :http:// www.bankofny.com
Toll free +1 888 269 2377 (USA & Canada only)






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