SABMiller lifts LatAm beer target on economy boost

LONDON: SABMiller, the world's No. 2 brewer, raised its forecast for beer volume growth in its biggest region of Latin America due to price cuts on its products and a strengthening economic recovery.

The London-based brewer of Grolsch, Peroni and Miller Lite, which is bidding for Australia's Foster's Group , said regional beer volume for its April-June quarter was up around 6 percent while its key Colombian market had seen 10-percent plus volume growth in June.

"Our volume target is going up as economic recovery is now feeding through to consumption, and due to our strategy of making beer more affordable," Karl Lippert, president of SABMiller's Latin America region told an investor seminar.

The better performance and raised target contrasts with the year to end-March 2011, when regional beer volumes were flat and Colombia which accounts for more than half of regional profit saw volume drop 6 percent due to tax rises and heavy rains.

The brewer, which makes 31 percent of its profit from the region, said the recovery in its first quarter of April-June was very good in Colombia, Panama, Honduras and El Salvador, modest in Ecuador and soft in Peru and Argentina.

The group which makes Aguila, Club Colombia and Cusquena beers in the region raised its 3-5 year target for volume growth to 5-8 percent a year from 4-6 percent, while cutting its revenue goal to 2-4 percent from 3.5-5.5 percent due to its strategy to make beer more affordable.

Copyright Reuters, 2011