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SABMiller lager sales lose their fizz

Published: 08:55 23 Jul 2015 BST

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Ukrainian political woe and lower beer demand in Russia hits SABMiller.

European drinkers lost their thirst for lager in the first quarter, limiting the impact of a better performance in emerging markets by brewer SABMiller (LON:SAB).

The Peroni Nastro Azzurro brewer said lager volumes fell 1% in the three months to June 30, partly offsetting a 4% rise in soft drink demand.

Revenue and volumes grew strongly in Latin America and Africa in the quarter, led by Colombia and the group's Aguila Light and Miller Lite brands.

In Africa, lager and soft drinks volumes rose 4%. 

But in Europe, beverage volumes fell 6%, driven by a lager volume decline of 8%.

In the UK, continued growth of Peroni was offset by declines in demand for the company's Polish brands.

In Poland, the company stopped supplying a leading convenience chain and faced price competition, hitting net producer revenue (NPR) by 17%.

SABMiller said continued weakness in lager volumes was mainly driven by geopolitical uncertainty in Ukraine and a beer market decline in Russia.

Overall group NPR rose 3% on level beverage volumes, reflecting group NPR per hectolitre (hl) growth in all regions.

Chief executive Alan Clark said: ""Both revenue and volumes grew strongly in Latin America and Africa in the quarter, tempered in particular by a challenging quarter in our key European markets where the trading environment remains difficult and softer volumes in China.

"We continue to make good progress in our strategy of driving top line growth which is reflected in the growth of revenue per hectolitre across our regions."

Shares rose 3p to 3442.5p.

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