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SABMiller provided an update on its full-year trading for the 12 months ending March 31st this morning.  We won’t focus on the broader results, but wanted to highlight the company’s commentary with respect to the MillerCoors JV.

 Shipments to retailers declined 3.3% in the quarter to March (TAP’s first quarter) with shipments to wholesalers declining 2.5%.  The company commented on “weaker industry performance” which is wholly consistent with our view on a weaker February and March, with weather being a contributing factor.  However, recall that our view is that the U.S. domestic industry will likely see down volume in the 2-3% range in 2013 as we lap a relatively strong 2012 and the economy remains broadly lackluster.

The weakness was across segments, with the following commentary:

“Premium light STRs were down mid single digits in the quarter, with a low single digit decline in Coors Light and a high single digit decline in Miller Lite. The premium regular and economy segments both declined by mid single digits. The Tenth and Blake division saw high single digit growth, driven by Blue Moon and supported by the national expansion of Batch 19. The above premium segment saw double digit growth following the national launch of Redd’s Apple Ale and Third Shift Amber Lager”

We remain below consensus for Q1 on TAP, as well as the full-year and it remains one of least preferred names in consumer staples.


Robert  Campagnino

Managing Director




Matt Hedrick

Senior Analyst