Grupo Modelo’s net sales up 6.5%

Grupo Modelo, Mexico’s major brewer, reported net sales of Ps. 7.037 bn for the first quarter of 2001, an increase of 6.5% compared with the same period last year. Total beer shipments grew 14.1%, given the strong export shipments (22.7%). However, net sales of Grupo Modelo only increased 6.5% which was attributed to an 8.4% fall in real terms in the average price per hectolitre for the domestic market. Consolidated net income for the first quarter stood at Ps. 1.123 bn, up 11.4%. Operating margin was reduced 0.4% to 25.2%. "The sale of assets not related to our main activity as well as lower advertising expenses have offset the gross margin reduction, maintaining the operating margin relatively stable," Carlos Fernandez, CEO of Grupo Modelo, was quoted as saying.

Nothing in excess

Grupo Modelo got itself a flashy website which would make the film geeks in Hollywood envious. Visit www.gmodelo.com and should you feel like booking a holiday, check out its "Mexico on video" section (follow the "multimedia" link). This should give you some idea about sun, surf, sea and ... whateveryoulike.

Femsa’s net sales up 8.5%

Fomento Economico Mexicano, S.A. de C.V. and Subsidiaries ("FEMSA"), Latin America’s largest beverage company, reported consolidated net sales of Ps. 10.850 bn for the first quarter of 2001, an increase of 8.5% over the first quarter of 2000. Consolidated revenue growth was driven by revenue growth in each of FEMSA’s principal divisions - FEMSA Cerveza and Coca-Cola FEMSA. Sales volume for FEMSA’s beer products posted a growth rate of 12.2% for the first quarter of 2001 as FEMSA Cerveza had raised prices gradually and selectively in different regions of Mexico throughout the quarter as opposed to the one-time increase implemented in early January in previous years. Soft-drink volumes increased by approximately 3. FEMSA’s retail and packaging subsidiaries also posted revenue growth of 21..

Male bait

Think of a Diva and what immediately comes to mind? Right. The Figure. A big figure. This must be the reason why South African Breweries (SAB) calls its 660ml returnable bottle a "Diva". SAB’s "Redd’s Premium Dry", a dry-tasting apple flavoured fruit ale, is now packed in a 340ml can, a 340ml non-returnable bottle and a "Diva". Redd’s Premium Dry is a line extension of the original "Redd’s Premium Cold" which was launched several years ago in response to Stellenbosch Farmers Winery (SFW) putting an apple cider, "Hunter’s Gold", into the market. Actually Hunter’s Gold was a flavoured wine but this gave SAB the idea of coming up with its own version of a cider: an unhopped, beer-based, apple flavoured alcoholic beverage. Hence the 660ml Diva for the recently launched Redd’s Premium Dry..

Heineken brewed at Chamdor Brewery

Heineken is now produced at SAB’s Chamdor Brewery which makes South Africa one of almost 20 countries to brew the brand.

Quaffing plonk

South African Breweries (SAB) may have a market share of 98 % in the South African beer market, but is far from immune to the threat posed by fuel price hikes (+ 50 % over the past year) and cheap wine. For the half-year to 30 September 2000, beer volumes declined 6 % due to a surplus of cheap wine which is selling for as little as 30 cents per litre. Beer prices in the townships are relatively cheap too – only 30 cents per pint. However, in a poor economy, price per volume plays a decisive role. Hence, SAB reported a 2.8 % decline in half-year profits to US$310 million from US$319 million. Despite strong performances in Eastern Europe and China, the brewer stills earns more than 50 % of its profits in rand..

Beck’s brewed in Namibia

Following the joint venture signed between German Brauerei Beck and Namibian Ohlthaver & List Group of Companies, which owns a majority stake in Namibia Breweries Ltd. (NBL), Beck’s has been brewed under licence in Namibia since October 2000. NBL will market and distribute Beck’s in southern Africa. Beck’s was introduced to the southern African market in the 1950s. In 1999, 3,000 hl of Beck’s were sold there. Dieter Ammer, Managing Director of Brauerei Beck, believes that there is a lot of scope for developing the premium brand in the coming years. NBL is the largest importer of beer into the Republic of South Africa.

Diversification next

East African Breweries Ltd. (EABL) plans to float its breweries in Uganda and Tanzania in an effort to generate funds to move into the lucrative spirits market. EABL aims to buy the shares it does not own already in both breweries and then float them on the two countries’ stock markets.
EABL, whose main shareholder is Diageo, controls 64 % of Uganda Breweries Ltd. and through Diageo’s subsidiary Guinness, controls another 30 %. The balance is held by minorities. In Tanzania’s Kibo Breweries, EABL owns 86 % and intends to buy out its partner. Diageo holds 46.7 % of EABL and is expected to raise that shareholding to more than 50 % should the first float - Uganda Breweries Ltd. - go through. EABL is the fourth largest capitalised company on the Nairobi stock exchange..

New brewery

Commissioning of the new Dashen Brewery, Gondar, ended when the first kegs were filled. The brewery is owned by Ethiopian (60 %) and French investors. Danbrew supplied the plant turn-key. The current capacity is 300,000 hl, this can be easily increased to 500,000 hl p.a. by simply adding some more fermenters. The brewery is located in the historical town of Gondar in the north of the country. 170 people are currently employed.
This is the first and only plant in Ethiopia having waste water treatment..

It seems like there will be soon some serious beer action in Africa’s most populous country, where Guinness and Heineken are calling the shots - so far. Guinness, through its 53% stake in Guinness Nigeria, and Heineken, which owns 40% of Nigerian Breweries, control the market. South African Breweries, which sold 25.1 million hl of beer in South Africa, still has no brewing plant in Nigeria but is already exporting beer there from South Africa.
Nigeria was once considered Africa’s most interesting beer market. In the late 1970s, consumption was 12 million hl when the economy prospered thanks to the high oil revenues. In sync with falling oil prices, consumption dropped below 4 million hl in the 1980s. In addition, Heineken plans to buy Con-solidated Breweries Ltd..