SABMiller reports profits miss as it scales back African operations

Results hurt by $572 million charge in Angola, South Sudan

Brewer expects AB InBev deal to close after Aug. 12 dividend (Photo Illustration by Scott Olson/Getty Images)

SABMiller, the brewer that’s due to be bought by Anheuser-Busch InBev later this year, reported full-year earnings that missed analysts’ estimates as it was saddled with charges related to some African operations and costs associated with the takeover.

Adjusted pretax profit in the year ended March 31 fell 16 per cent to $4.1 billion, the London-based maker of Castle lager said Wednesday in a statement. Analysts expected $4.58 billion, according to estimates compiled by Bloomberg.

Earnings were hurt by a $572 million charge from impairments to investments in Angola and war-torn South Sudan, as well as $160 million in costs associated with the AB InBev deal.

The maker of Blue Moon wheat ale is shedding some assets and shuffling others around as it awaits regulatory approval of the takeover. AB InBev is selling SAB’s Peroni, Grolsch and Meantime brands in Europe to satisfy antitrust concerns as it seeks to close the deal in the second half of the year. Last week, AB InBev transferred SAB’s Panamanian business to its Brazilian Ambev unit, moving the companies one step closer together.

“These are good results,” SABMiller Chief Executive Officer Alan Clark said in the statement. “We grew EBITA across all regions and our group EBITA margin improved through the year.”

SABMiller also said it expects its performance to be crimped by the strong dollar in the year ahead, as it prepares to be absorbed into its Belgian rival in the industry’s biggest-ever deal. It said it still expects the transaction to close in the second half of the year, sometime after SABMiller pays its final dividend on August 12.

The brewer had already reported a gain in fourth-quarter beer shipments, led by growth in Africa and Latin America. SABMiller gets more revenue from developing regions than other major brewers.

© 2016 Bloomberg L.P