BUD Anheuser Busch Inbev SA NV

By Ian Walker and Saabira Chaudhuri 

LONDON-- SABMiller PLC reported an 18% fall in fiscal-year net profit following a one-time charge and currency volatility though beer volumes climbed.

The company, in the middle of a roughly $108 billion takeover by bigger rival Anheuser-Busch InBev NV, said on Wednesday that the deal is unlikely to close before the full-year dividend is paid out, welcome news for SABMiller's shareholders.

Net profit fell to $2.7 billion in the year to end-March from $3.3 billion the previous fiscal year while pretax profit fell 16% to $4.07 billion. SABMiller logged a $721 million one-time charge related to investments in Angola and South Sudan and costs tied to the AB InBev deal.

Revenue fell 10% to $19.83 billion. Net producer revenue--a measure which strips out excises duties and similar taxes as well as SABMiller's share of associate companies' and joint-venture revenues--rose 5% on an organic, constant-currency basis.

Beverage volumes for the year rose 2%, with beer volumes up 1%, and soft-drinks volumes up 6%.

Chief Executive Alan Clark said the company's staff turnover has been "very low" following the AB InBev announcement, citing a retention plan the brewer has put in place.

Staff costs and investment-banking fees contributed to a one-time $160 million charge that SABMiller logged tied to the AB InBev merger, which when completed will create the world's biggest beer group with about 30% of the global beer market.

SABMiller also logged $491 million in one-time charges for its Angola business after devaluation of the local currency against the dollar forced it to scale down operations there, in addition to a $317 million charge in South Sudan where it has closed operations for the same reason.

The company declared a final dividend of 93.75 cents a share, making a total payout for the year of 122 cents, compared with 113 cents for the year ended March 31, 2015.

SABMiller said its cost-cutting program is on track to achieve savings of $1.05 billion in 2020.

Analysts at Exane said SABMiller had delivered a good second half, adding that "SABMiller cannot be accused of slacking" ahead of the AB InBev deal's closure.

While AB InBev's shares have climbed since the brewer announced its deal with SABMiller, Mr. Clark said he had not been approached by any investors showing interest in the so-called partial share alternative, which he attributed to volatility in share prices.

AB InBev has offered the partial-share alternative, essentially a combination of cash and unlisted stock, for 41.6% of SABMiller stock, an option that was designed for SABMiller's largest shareholders: cigarette giant Altria Group Inc., and the BevCo Ltd. investment vehicle of Colombia's Santo Domingo family.

However as AB InBev's stock has climbed, the value of the share component of the deal has risen leading some to speculate that more SABMiller shareholders might opt for this possibility, reducing the shares available for Altria and the Santo Domingos.

"At the moment we have no feedback from investors about it," said Mr. Clark. "I think that is largely because of the volatility in the prices and there is no certainty."

Write to Ian Walker at ian.walker@wsj.com and Saabira Chaudhuri at saabira.chaudhuri@wsj.com

(END) Dow Jones Newswires

May 18, 2016 05:42 ET (09:42 GMT)

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