According to the Britvic Soft Drinks Report 2008, the energy drinks sector reported a 4% decline in total-on-premise sales in 2007, as a whole. Red Bull was the only product in this category that remained stable, posting a sales growth of 1%. Underlining Red Bull's dominance of the energy drinks sector, Danone has announced its decision to cease production of its own energy drink, V, as a result of the product's flagging performance. V has struggled to compete with the market leader and a £3.3 million re-launch, less than a year ago, did not make a significant difference in terms of sales. Furthermore, this was the second time Danone had revamped the product, highlighting the efforts that it expended to take market share from its chief competitor.

This week also saw the completion of Cadbury's demerger of its Americas Beverages business to the Dr Pepper Snapple Group. The reduction of Cadbury's capital was confirmed and the company has filed the court order effecting the demerger. The share capital of the company has been reduced by cancelling the entirety of the beverage shares, decreasing the value of each Cadbury share from 500 pence to 10 pence, establishing distributable reserves of approximately £6.6 billion.

Edited by

Adam Smith

IN THIS ISSUE

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LATEST COMMENT

Ancient grains stage a revival in the packaged food industry

Packaged food and beverage markets are seeing a growing influx of new products featuring grains that were favored by civilizations thousands of years ago. According to Datamonitor's Productscan Online database of new products, new food and beverage launches featuring a short list of ancient grains, including chia, have doubled since 2005 as manufacturers jump on the latest health food band wagon. Read full article

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BREWING NEWS

AmBev Q1 net sales up
AmBev, a producer and distributor of beer and soft drinks, has reported that its net sales in the first quarter of 2008 increased organically by 7.1% to R$4.85 billion from R$4.66 billion in the first quarter of 2007. Read full article

Butte Creek launches organic beer
Butte Creek Brewing, a wholly owned subsidiary of Golden West Brewing Company, has announced the limited release of its beer Spring Run Organic Pale Ale. Read full article

C&C expects good summer to lift cider sales
Drinks group C&C has said that it expects a good British summer to help revive its cider sales after a wet summer in 2007 led to a fall in profits. Read full article

Asia Pacific Breweries H1 group revenue up
Asia Pacific Breweries has reported group revenue of S$1.06 billion for the first six months ended March 31, 2008, an increase of 14% compared to the same period in 2007. Read full article
Company information: Asia Pacific Breweries Limited

Carlsberg Q1 net revenue up
Carlsberg has reported that its net revenue for the first quarter of 2008 increased 6% to DKK9.4 billion compared with DKK 8.9 billion for the first quarter of 2007. Read full article
Company information: Carslberg A/S

United Breweries plans to launch low alcohol and fruit flavored beers in India
In a year's time, United Breweries intends to launch fruit flavored beer brands and low alcohol drinks in India, revealed The Financial Express. Read full article

SabMiller agrees to purchase 99.84% interest in Sarmat
SabMiller has agreed to acquire a 99.84% interest in the Ukrainian brewer Sarmat. The transaction is subject to approval by the Ukrainian competition authorities and other customary pre-closing conditions. Read full article
Company information: SABMiller

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WINE & SPIRITS NEWS

Diageo says inputs costs will continue to rise
Alcoholic drinks group Diageo said that its input costs will rise by 3% or around GBP90 million in its current year to the end of June 2008, but the rise would be higher in its following year to end-June 2009, reported Reuters. Read full article
Company information: Diageo plc

Pernod Ricard unit introduces Kahlua Mocha
Malibu-Kahlua International, a unit of Pernod Ricard, has introduced a new coffee liqueur called Kahlua Mocha. Read full article
Company information: Pernod Ricard

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NON-ALCOHOLIC DRINKS NEWS

Danone to reportedly scrap V energy drink
Danone is likely to axe its V energy drink as result of the product's flagging performance, revealed Marketing Week. Read full article
Company information: Groupe Danone

Cadbury announces demerger of Americas Beverages
Cadbury has completed the demerger of its Americas Beverages business to Dr Pepper Snapple Group, an integrated brand owner, bottler and distributor of non-alcoholic beverages.
Read full article
Company information: Cadbury Schweppes plc

Revolution signs partnership agreement with Kraft
Revolution Tea has signed a partnership agreement with Kraft Foodservice for national distribution in the foodservice channel. Read full article
Company information: Kraft Foods, Inc

Coca-Cola eyes acquisitions to grow
Muhtar Kent, president and COO of Coca-Cola, said that the company is looking at acquisitions in the soft drinks market for expanding its business, revealed Reuters. Read full article
Company information: The Coca-Cola Company

China bans Coca-Cola's soft drink and Pringles potato chips
China has banned berry-flavored soft drink Fanta, manufactured by Coca-Cola, and 'spicy salad sauce' and 'crispy baked' flavors of Pringles potato chips, produced by Procter and Gamble, for containing harmful ingredients, reported Agence France-Presse. Read full article
Company information: The Coca-Cola Company

Indian tea companies may consider price hike
Tea manufacturers in India are likely to follow Tata Tea in hiking their product prices, owing to the rising wholesale prices across the world, reported The Times of India. Read full article
Company information: Tata Tea

Sun Shower unveils new line of smoothies
Sun Shower, a brand of NBI Juiceworks, has introduced a new line of all natural 100% juice superfood smoothies. Read full article

Boo Koo's Q1 net sales down 79%
Boo Koo, an energy drinks company, has reported net sales of $501,557 for the first quarter ended March 31, 2008, a decrease of 78.8% compared to $2.4 million in the first quarter of fiscal 2007. Read full article

Lassonde's Q1 net sales increase
Lassonde Industries, a food and drinks company, has reported net sales of $118.5 million for the first quarter ended March 29, 2008, an increase of 35.9% compared to $87.2 million in the first quarter of 2007. Read full article

Hansen Natural Q1 gross sales up 28%
Hansen Natural, a producer of alternative beverage category natural sodas, fruit juices and juice drinks, has reported that its gross sales for the first quarter of 2008 increased 28.4% to $244 million, compared to $190.1 million in the first quarter of 2007. Read full article
Company information: Hansen Natural Corporation

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REPORT BESTSELLERS

MARKET TRENDS

Beer and ale: top flavors in new global product launches
According to the Productscan database, aside from blend, the leading flavor in global beer and ale launches in the 12 months to March 2008 was sweet, followed by wheat and fruity. Wheat and spicy increased in popularity during the period, both moving into the list of the top 10 most used flavors in new global product launches. Read full article

Product claims: new drinks launches, December 2007 to February 2008
According to Productscan, 'high vitamins' was the leading claim on new global drinks launches between December 2007 and February 2008. Indeed, during the period, the 'high vitamins claim' appeared on more than 14% of new launches. Likewise, the 'upscale' and 'natural' claims, which remain at second and third place on the leader board, respectively, appeared on over 10% of new launches. An increase of a third in the number of new products tagged as 'pure' was also seen during the period. Read full article

New drinks launches by category, December 2007 to February 2008: good times brewing for tea
Fruit & fruit flavored drinks was the leading category in new global drinks launches for the three months to February 2008, according to the Productscan database. Meanwhile, tea is at second place on the leader board, having witnessed an increase of nearly 50% in new launches during the period. Coffee is at third place, following an increase in launches of more than a third. Elsewhere, launches of liqueurs and other alcoholic drinks were down 51% compared to the same period the year before. Read full article

Milk and yogurt drinks: top flavors in new global product launches
According to the Productscan database, aside from blend, strawberry and chocolate were the most popular flavors of new milk and yogurt drinks launched worldwide in the 12 months to February 2008. Vanilla is now in fourth place on the leader board, replacing peach, which moves down to seventh place. Pineapple is the only new entrant on the leader board, making an appearance in joint ninth position. Read full article

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COMPANY SPOTLIGHT

Inbev

InBev, a brewing company, has reported revenue of €3.19 billion for the first quarter of 2008, an organic growth of 4.8% compared to €3.05 billion in the first quarter of 2007. Gross profit was €1.83 billion, an organic growth of 1.6% compared to €1.78 billion in the corresponding period of 2007.

Normalized EBIT was €715 million, down 1.1% compared to €708 million in the first quarter of 2007. Normalized EBITDA stood at €982 million, compared to €962 million in the corresponding period of 2007.

Profit attributable to equity holders of InBev (normalized) was €266 million, compared to €283 million in the same period of 2007. Profit attributable to equity holders of InBev was €249 million, compared to €280 million in the first quarter of 2007.

Normalized earnings per share were €0.44, compared to €0.46 in the same period of 2007. Earnings per share were €0.41, compared to €0.46 in 2007.

Carlos Brito, CEO of InBev, said that the company believes it has the right programs in place to deliver stronger results in the following quarters, allowing it to resume EBITDA margin expansion in the second half of 2008.


Key facts

Brouwerijplein 1
3000 Leuven
Belgium

Tel: 32 16 27 61 11
Fax: 32 16 50 61 11
Web: www.inbev.com

Brussels Ticker: INTB
No. Employees: 77,000

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