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SouthAfricanBrewerie (SAB)

  Print      Mail a friend       Annual reports

Thursday 31 May, 2001

SouthAfricanBrewerie

Preliminary Results - Part 3

South African Breweries PLC
31 May 2001

PART 3

'South African Breweries plc
Notes to the Financial Statements





5. Taxation on profit on ordinary activities
                                                 2001    2000      2001    2000
                                            Unaudited Audited Unaudited Audited
                                                 US$m    US$m        Rm      Rm
South African income taxation

Current taxation at 30%                           107     113       788     697
Deferred taxation                                   1     (5)         5    (33)
Prior year adjustments                              3       1        23       5
                                                  111     109       816     669
Other foreign taxation

Current taxation                                   52      41       381     254
Deferred taxation                                 (6)       3      (41)      15
Prior year adjustments                              5     (1)        36     (4)
                                                   51      43       376     265
Witholding taxes and secondary taxation on
companies                                          10      15        75      92
Share of associates' taxation charge               14      19        99     119
                                                  186     186     1,366   1,145
Effective tax rate, before goodwill
amortisation
and exceptional items (%)                        28.0    24.8







6. Earnings per share
                                              2001     2000      2001     2000
                                         Unaudited  Audited Unaudited  Audited
                                          US cents Us cents  SA cents SA cents
Basic earnings per ordinary share             51.5     64.3     378.0    395.6
Diluted basic earnings per ordinary           51.4     64.1     376.8    394.7
share
Adjusted basic earnings per ordinary          54.4     56.6     399.2    348.4
share





The calculation of basic earnings per ordinary share has been based on the
profit for the financial year as shown below, and on a weighted average number
of shares in issue of 697,115,210  (2000:752,845,481).



At 31 March 2001 there were 9,431,500 share purchase options outstanding under
the SAB Limited Executive Share Purchase Scheme, 2,017,276 share purchase
options outstanding under SAB plc option schemes, 451,442 shares which may be
issued in accordance with the SAB Share Awards Scheme and a further 451,440
shares which have been awarded under the SAB Executive Performance Share Award
Scheme which have not yet vested.  The calculation of diluted earnings per
share is based on a weighted average number of shares in issue of 699,405,049
after adjusting for 2,289,839 weighted potentially dilutive ordinary shares
and the profit for the financial year as shown below. The average share price
of SAB plc since the beginning of the year, used in determining the number of
potentially dilutive ordinary shares, is US$6.84, compared with an average
strike price on the outstanding options of US$5.46.



The group has also presented an adjusted earnings per share figure to exclude
the impact of amortisation and other non-recurring items in order to present a
more meaningful comparison for the years shown in the consolidated financial
statements. Adjusted earnings per share has been based on adjusted headline
earnings for each financial year and on the same number of weighted average
ordinary shares in issue as the basic earnings per share calculation.
Headline earnings per share has been calculated in accordance with the
Institute of Investment Management and Research ('IIMR')'s Statement of
Investment Practice No. 1 entitled 'The Definition of Headline Earnings'.  The
adjustments made to arrive at headline earnings and adjusted earnings are as
follows:






                                                 2001    2000      2001    2000
                                            Unaudited Audited Unaudited Audited
                                                 US$m    US$m        Rm      Rm
Profit for the financial year                     359     484     2,635   2,979
Amortisation of goodwill                           20       6       144      35
Impairment of Monyaka                               6       -        41       -
Profit on sale of Sun International               (5)       -      (38)       -
Profit on disposal of PGSI after taxation
of US$8 million (R50 million)                       -    (68)         -   (418)
Brewery closure costs in SAB International          -      11         -      66
Profit on sale of fixed assets and                (4)    (14)      (22)    (82)
investments (1)
Headline earnings (basic)                         376     419     2,760   2,580

Reorganisation costs (2)                            3       7        23      43
Adjusted Earnings                                 379     426     2,783   2,623



(1) Profit on sale of fixed assets and investments is stated after the impact
of taxation and minority interests



(2) Includes reorganisation costs of Distell Group Limited and Hotels and
Gaming, prior year represents      reorganisation costs incurred by PGSI  in
North America





7. Intangible fixed assets
                                           Trademarks        Goodwill     Total
                                                 US$m            US$m      US$m
Net book amount

At 31 March 2000 (audited)                          4             604       608
At 31 March 2001 (unaudited)                        2             865       867





7. Intangible fixed assets
                                          Trademarks        Goodwill      Total
                                                  Rm              Rm         Rm
Net book amount

At 31 March 2000 (audited)                        23           3,948      3,971
At 31 March 2001 (unaudited)                      16           6,922      6,938







Net of currency impacts and amortisation, the goodwill of US$865 million
(R6,922 million) for the year ended 31 March 2001 includes US$281 million
(R2,058 million) in respect of the increase in shareholding of Pilsner Urquell
(PU), US$32 million (R238 million) in respect of the increase in shareholding
of Amalgamated Beverage Industries Ltd (ABI) and US$30 million (R217 million)
in respect of the increase in shareholdings in several SAB International
operations.



The goodwill arising from the acquisitions in SAB International is being
amortised over 20 years. The directors believe that the purchased goodwill in
respect of the further acquisition of ABI currently has an indefinite life.
This is consistent with the treatment of goodwill that arose on the
acquisition of Suncrush, which was acquired on 8 June 1998. The directors
consider the goodwill to be supported by the existence of bottlers' agreements
with Coca-Cola (Southern Africa) (Proprietary) Limited (CCSA).  ABI has
similar bottlers' agreements in respect of other regions within South Africa.
These bottlers' agreements, which are based on the Coca-Cola system, establish
performance obligations as to production, distribution and marketing
arrangements to maximise long-term growth in volume, cash flow and shareholder
value of the bottler company.  The Coca-Cola system came into being during
1899 and has had a consistent history of growth and success since that date.



The Suncrush agreements with CCSA were established in 1955 and have been in
place since then.  The current agreements are for a period of ten years, with
an extension of five years, expiring on 30 September 2007 and contain
provisions for renewal at no cost.  ABI has had similar agreements since 1976
and they have always been renewed prior to expiry. In the view of the
directors, the bottlers' agreements reflect a long and ongoing relationship
between the respective managements of ABI and CCSA.



The directors have given due consideration to approved financial forecasts in
respect of the ABI business, the history of dealings of ABI with CCSA and the
established international practice of The Coca-Cola Company Inc. in relation
to its bottlers' agreements. In light of the above factors, the directors
believe that the Suncrush agreements will continue to be renewed at the end of
their legal expiry dates and the commercial value of the Coca-Cola product
will be maintained.  Accordingly, the directors are of the view that the
goodwill, as underpinned by the bottlers' agreements, currently has an
indefinite economic life.  The directors have performed a review for
impairment at 31 March 2001 and are of the opinion that no provision is
required.



The amount of gross cumulative goodwill in respect of purchased subsidiary and
associated undertakings, which has been set off against shareholders' funds at
31 March 2001 was US$172 million (R1,375 million) and US$187 million (R1,220
million) at 31 March 2000.


 
South African Breweries 
Notes to the Financial Statements  
 
8. Provisions for liabilities and charges 

                                                                              
                                                        Bottled        Post-  
                                         Demerged           and    retirement 
                             Safelite    entities    containers      benefits 
                                US$m        US$m          US$m           US$m 
  At 31 March 1999                233          62            10            25 
  (audited)                                                                   
  Exchange adjustments              -         (2)             -           (1) 
  Increase in Safelite             14           -             -             - 
  net liabilities                                                             
  transferred from                                                            
  associates                                                                  
  Arising on the                    -           -             -             - 
  acquisition of                                                              
  subsidiary undertakings                                                     
  Arising on the disposal       (247)           -             -           (3) 
  of subsidiary                                                               
  undertakings                                                                
  Charged/(credited) to             -           -           (7)             9 
  profit and loss account                                                     
  Utilised in the year              -        (16)           (3)           (1) 
  At 31 March 2000                  -          44             -            29 
  (audited)                                                                   
  Exchange adjustments              -         (8)             -           (3) 
  Charged/(credited) to             -           -             -             4 
  profit and loss account                                                     
  Utilised in the year              -        (11)             -           (3) 
  Transfer to creditors             -           -             -           (5) 
  At 31 March 2001                  -          25             -            22 
  (unaudited)                                                                 
 
 
8. Provisions for liabilities and charges (continued)           

                                                                              
                                                            Deferred          
                                                   Other    taxation    Total 
                                                    US$m        US$m     US$m 
  At 31 March 1999 (audited)                          49          22      401 
  Exchange adjustments                               (3)         (1)      (7) 
  Increase in Safelite net liabilities                 -           -       14 
  transferred from associates                                                 
  Arising on the acquisition of subsidiary             2           5        7 
  undertakings                                                                
  Arising on the disposal of subsidiary                -           2    (248) 
  undertaking                                                                 
  Charged/(credited) to profit and loss account        8         (3)        7 
  Utilised in the year                              (16)           -     (36) 
  At March 2000 (audited)                             40          25      138 
  Exchange adjustments                               (3)         (3)     (17) 
  Charged/(credited to profit and loss account         3         (5)        2 
  Utilised in the year                              (15)           -     (29) 
  Transfer to creditors                                -           -        5 
  At 31 March 2001 (unaudited)                        25          17       89 
 
 
8. Provision for liabilities and charges (continued) 

                                                                              
                                                         Bottles        Post- 
                                           Demerged          and   retirement 
                      Safelite             entities   containers     benefits 
                            Rm                   Rm           Rm           Rm 
  At 31 March 1999       1,446                  383           62          156 
  (audited)                                                                   
  Exchange                   5                    -          (2)          (2) 
  adjustments                                                                 
  Increase in               86                    -            -            - 
  Safelite net                                                                
  liabilities                                                                 
  transferred from                                                            
  associates                                                                  
  Arising on the             -                    -            -            - 
  acquisition of                                                              
  subsidiary                                                                  
  undertakings                                                                
  Arising on the       (1,537)                    -            -         (13) 
  disposal of                                                                 
  subsidiary                                                                  
  undertakings                                                                
  Charged/(credited)         -                    -         (42)           57 
  to profit and                                                               
  loss account                                                                
  Utilised in the            -                 (98)         (18)          (6) 
  year                                                                        
  At 31 March 2000           -                  285            -          192 
  (audited)                                                                   
  Exchange                   -                    -            -           15 
  adjustments                                                                 
  Charged/(credited)         -                    -            -           24 
  to profit and                                                               
  loss account                                                                
  Utilised in the            -                 (82)            -         (19) 
  year                                                                        
  Transfer to                -                    -            -         (35) 
  creditors                                                                   
  At 31 March 2001           -                  203            -          177 
  (unaudited)                                                                 
 
 
8. Provisions for liabilities and charges (continued)           

                                                                              
                                                          Deferred            
                                                 Other    taxation      Total 
                                                    Rm          Rm         Rm 
  At 31 March 1999 (audited)                       300         138      2,485 
  Exchange adjustments                               6           2          9 
  Increase in Safelite net liabilities               -           -         86 
  transferred from associates                                                 
  Arising on the acquisition of subsidiary          11          30         41 
  undertakings                                                                
  Arising on the disposal of subsidiary              -          11    (1,539) 
  undertaking                                                                 
  Charged/(credited) to profit and loss             43        (17)         41 
  account                                                                     
  Utilised in the year                            (98)           -      (220) 
  At 31 March 2000 (audited)                       262         164        903 
  Exchange adjustments                              25           7         47 
  Charged/(credited) to profit and loss             25        (36)         13 
  account                                                                     
  Utilised in the year                           (112)           -      (213) 
  Transfer to creditors                              -           -       (35) 
  At 31 March 2001(unaudited)                      200         135        715 
 
 
Safelite 
 
Following the disposal of PGSI on 30 November 1999, the provision in respect
of Safelite Glass Corp.'s net liabilities is no longer required. 
 
Demerged entities 
 
During the year ended 31 March 1998, the group recognised a provision of
US$117 million (R562 million) for the disposal of certain demerged entities
in relation to equity injections which were not regarded as recoverable, as
well as potential liabilities arising on warranties and the sale agreements.
During the year ended 31 March 2001, US$11million (R82 million) was further
utilised in regard to the disposal of SAB Limited's remaining retail
interests. The residual US$25 million (R203 million) relates mainly to the
disposal of OK Bazaars (1929) Limited to Shoprite Holdings Limited
('Shoprite'). As disclosed in last year's annual report, a number of claims
were made by Shoprite in relation to the valuation of the net assets of OK
Bazaars at the time of the sale and for alleged breaches by SAB Limited of
warranties contained in the sale agreements. These claims, are being
contested by SAB Limited and have been submitted for dispute resolution to
independent accountants acting as experts and not as arbitrators. In March
2000 an opinion was received from the experts but subsequent to the year end
Shoprite have instituted action against the independent experts and SAB
indicating an intention to refute the expert opinion. While full provision
for all claims has already been made on the basis of prudence, the actual
outcome of the dispute cannot be estimated by the directors at this time. The
further information ordinarily required by financial reporting standard 12 -
'Provisions, Contingent Liabilities and Contingent Assets' - has not been
disclosed on the grounds that it can be expected to seriously prejudice the
outcome of the dispute. 
 
Bottles and containers 
 
The group previously recognised a provision in respect of deposits payable on
non-branded bottles and containers used by entities within the SAB
International businesses. The provision related to those territories where a
homogeneous bottle or container was used by all brewers and a deposit system
was in operation. In those circumstances, it was not possible to identify if
a particular bottle or container was originally issued by an SAB
International entity and thus the potential liability of the group took into
account the overall bottle and container population. The group therefore
included an estimate of the potential liability it may have had in respect of
bottles and containers which were in general circulation, taking into account
the size of the overall pool, the number of bottles and containers it had
issued and the return rates. The level of this provision was dependent on
these factors and the extent to which, in certain territories, unbranded
bottles and containers were being replaced by branded bottles and containers.
As at 31 March 2000, the group no longer required a provision and where
reversals of this provision have occurred, some or all of it has been
credited against the corresponding asset balance for bottles and containers 
 
Post- retirement benefits 
 
The provision for post retirement benefits represents the provision for
medical benefits for retired employees and their dependants in South Africa.
The principal assumptions on which this provision is based will be disclosed
in the group's annual report. 
 
Other provisions 
 
At 31 March 2001 the group retained US$25 million (R200 million) of other
provisions. The principal individual components of this amount are as
follows: 
 
The group has recognised various provisions, totalling US$15 million (R117
million) at 31 March 2001, in relation to taxation exposures it believes may
arise in respect of a number of group companies. The provisions principally
relate to corporate taxation within the SAB International businesses and are
not individually significant. Any settlement in respect of these amounts will
occur as and when the assessments are finalised with the respective tax
activities. 
 
US$3 million (R27 million) of provisions in respect of outstanding litigation
within the SAB International operations have been retained, none of which are
expected to have adverse material consequences to the group. 
 
 
 
9. Reconciliation of operating profit to net cash inflow from operating
activities 

                                                                              
                                      2001       2000         2001       2000 
                                 Unaudited    Audited    Unaudited    Audited 
                                      US$m       US$m           Rm         Rm 
  Operating profit                     637        666        4,671      4,100 
  Depreciation                         167        189        1,223      1,164 
  Container amortisation                34         35          249        214 
  Container breakages and               11         10           78         64 
  shrinkage                                                                   
  Amortisation of intangible            20          7          147         43 
  fixed assets                                                                
  Dividends received from              (3)        (2)         (25)       (15) 
  other investments                                                           
  Profit on sale of fixed              (6)       (12)         (47)       (71) 
  assets                                                                      
  Non-cash impairment of                 5          -           35          - 
  Monyaka                                                                     
  Non cash impairment of                 -          9            -         55 
  Hungarian Brewery                                                           
  Profit on disposal of Sun            (5)          -         (38)          - 
  International                                                               
  Deferred income                     (12)        (5)         (83)       (22) 
  Other non-cash moves                   6         20           51        114 
  Net cash inflow from                                                        
  operating activities before                                                 
  working capital movements            854        917        6,261      5,646 
  ('EBITDA')                                                                  
                                                                              
  Increase in stock                   (15)       (39)        (107)      (243) 
  Increase in debtors                 (42)       (11)        (312)       (72) 
  Increase/(decrease) in                62        (3)          456       (21) 
  creditors                                                                   
  Net cash inflow from                 859        864        6,298      5,310 
  operating activities                                                        
 
 
 
South African Breweries 
Notes to the Financial Statements 
 
10. Analysis of net debt 

                                                                              
                        Cash at                           Funding     Funding  
                           bank                               due   due after 
                            and                            within             
                        in hand    Overdraft    Total    one year    one year 
                           US$m         US$m     US$m        US$m        US$m 
  At 31 March 1999          137        (161)     (24)       (104)       (658) 
  (audited)                                                                   
  Cash flow                  71          121      192         (8)        (28) 
  Acquisitions                                                                
  (excluding                                                                  
  cash and                    -            -        -        (20)        (70) 
  overdrafts)                                                                 
  Disposals                   -            -        -          73         255 
  Exchange                 (11)            9      (2)           5          25 
  adjustments                                                                 
  Change in maturity          -            -        -       (216)         216 
  in net debt                                                                 
  Loan                        -         (18)     (18)          18           - 
  reclassification                                                            
  At 31 March 2000          197         (49)      148       (252)       (260) 
  (audited)                                                                   
  Cash flow                (11)         (48)     (59)         144       (595) 
  Disposals                   -            -        -           -           - 
  Exchange                 (21)           11     (10)          26          32 
  adjustments                                                                 
  Change in maturity          -            -        -        (38)          38 
  in net debt                                                                 
  Loan                        -            -        -          21           8 
  reclassification                                                            
                                                                              
  At 31 March 2001          165         (86)       79        (99)       (777) 
  (unaudited)                                                                 
 
 
 
 
10. Analysis of net debt (continued) 

                                                                              
                           Finance     Finance                                
                           leases       leases                                
                        due within   due after                Liquid      Net 
                          one year    one year    Total    resources     debt 
                              US$m        US$m     US$m         US$m     US$m 
  At 31 March 1999            (13)        (17)    (792)          612    (204) 
  (audited)                                                                   
  Cash flow                      1        (32)     (67)        (503)    (378) 
  Acquisitions                 (3)         (2)     (95)           14     (81) 
  (excluding cash and                                                         
  overdrafts)                                                                 
  Disposals                      2          17      347            -      347 
  Exchange                       4           2       36          (4)       30 
  adjustments                                                                 
  Change in maturity             2         (2)        -            -        - 
  in net debt                                                                 
  Loan                           -           -       18            -        - 
  reclassification                                                            
  At 31 March 2000             (7)        (34)    (553)          119    (286) 
  (audited)                                                                   
  Cash flow                      4        (40)    (487)         (64)      610 
  Disposals                      -           2        2            -        2 
  Exchange                       3          10       71          (2)       59 
  adjustments                                                                 
  Change in maturity             -           -        -            -        - 
  in net debt                                                                 
  Loan                        (21)         (8)        -            -        - 
  reclassification                                                            
  At 31 March 2001            (21)        (70)    (967)           53    (835) 
  (unaudited)                                                                 
 
Note: Liquid resources comprise short-term deposits with banks, which mature
within 12 months of the date of inception and amounts invested in short dated
liquid instruments 
 
 
10. Analysis of net debt (continued) 
 

                                                                              
                         Cash at                          Funding     Funding  
                            bank                              due   due after 
                            and                            within             
                        in hand    Overdraft    Total    one year    one year 
                             Rm           Rm       Rm          Rm          Rm 
  At 31 March 1999          847        (998)    (151)       (647)     (4,085) 
  (audited)                                                                   
  Cash flow                 438          743    1,181        (47)       (173) 
  Acquisitions                                                                
  (excluding                                                                  
  cash and                    -            -        -       (124)       (432) 
  overdrafts)                                                                 
  Disposals                   -            -        -         450       1,572 
  Exchange                  (2)           43       41        (56)          86 
  adjustments                                                                 
  Change in maturity          -            -        -     (1,332)       1,332 
  in net debt                                                                 
  Loan                        -        (108)    (108)         108           - 
  reclassification                                                            
  At 31 March 2000        1,283        (320)      963     (1,648)     (1,700) 
  (audited)                                                                   
  Cash flow                (79)        (354)    (433)       1,054     (4,365) 
  Disposals                   -            2        2           -           - 
  Exchange                  120         (13)      107        (76)       (491) 
  adjustments                                                                 
  Change in maturity          -            -        -       (279)       (279) 
  in net debt                                                                 
  Loan                        -            -        -         151          58 
  reclassification                                                            
  At 31 March 2001        1,324        (685)      639       (798)     (6,219) 
  (unaudited)                                                                 
 
 
 
10. Analysis of net debt (continued) 
 

                                                                              
                         Finance   Finance                                    
                         leases     leases                                    
                            due        due                 
                         within      after                  Liquid        Net   
                       one year   one year      Total    resources       debt 
                             Rm         Rm         Rm           Rm         Rm 
  At March 31 1999         (78)      (101)    (4,911)        3,793    (1,269) 
  (audited)                                                                   
  Cash flow                 (6)      (199)      (413)      (3,102)    (2,334) 
  Acquisitions             (15)       (14)      (585)           87      (498) 
  (excluding cash                                                             
  and overdrafts)                                                             
  Disposals                  15        102      2,139            -      2,139 
  Exchange                   17          2         49            2         92 
  adjustments                                                                 
  Change in maturity         13       (13)          -            -          - 
  in net debt                                                                 
  Loan                        -          -        108            -          - 
  reclassification                                                            
  At 31 March 2000         (42)      (223)    (3,613)          780    (1,870) 
  (audited)                                                                   
  Cash flow                  32      (294)    (3,573)        (471)    (4,477) 
  Disposals                   -         13         13            -         15 
  Exchange                  (4)          -      (571)          113      (351) 
  adjustments                                                                 
  Change in maturity        (3)          3          -            -          - 
  in net debt                                                                 
  Loan                    (151)       (58)          -            -          - 
  reclassification                                                            
  At 31 March 2001        (168)      (559)    (7,744)          422    (6,683) 
  (unaudited)                                                                 
 
 
Note: liquid resources comprise short-term deposits with banks, which mature
within 12 months of the date of inception and amounts invested in short dated
liquid instruments 
 
 
10. Analysis of net debt (continued) 
The group's net debt is denominated in the following currencies: 
 

                                                                              
                                         Denomination                
                                                            Other             
                     US                     Rand        currencies      Total 
                 dollars                                                       
                   US$m                     US$m              US$m       US$m 
  Gross            (72)                    (344)            (186)*      (602) 
  borrowings                                                                  
  (including                                                                  
  overdrafts)                                                                 
  Cash at           126                      110                80        316 
  bank and                                                                    
  liquid                                                                      
  resources                                                                   
  Net debt at        54                    (234)             (106)      (286) 
  31 March                                                                    
  2000                                                                        
  (audited)                                                                   
                                                                              
  Gross           (562)                    (330)             (161)    (1,053) 
  borrowings                                                                  
  (including                                                                  
  overdrafts)                                                                 
  Cash at            88                       31                99        218 
  bank and                                                                    
  liquid                                                                      
  resources                                                                   
  Net debt at     (474)                    (299)              (62)      (835) 
  31 March                                                                    
  2001                                                                        
  (unaudited)                                                                 
 
*Mainly Czech crowns 
 
10. Analysis of net debt (continued) 
The group's net debt is denominated in the following currencies: 

                                                                              
                                         Denomination                          
                                                            Other             
                          US dollars            Rand    currencies      Total 
                                  Rm              Rm            Rm         Rm 
  Gross borrowings             (468)         (2,248)       (1,217)    (3,933) 
  (including                                                                  
  overdrafts)                                                                 
  Cash at bank and               823             718           522      2,063 
  liquid resources                                                            
  Net debt at 31 March           355         (1,530)         (695)    (1,870) 
  2000 (audited)                                                              
                                                                              
  Gross borrowings           (4,496)         (2,637)       (1,296)    (8,429) 
  (including                                                                  
  overdrafts)                                                                 
  Cash at bank and               707             247           792      1,746 
  liquid resources                                                            
  Net debt at 31 March       (3,789)         (2,390)         (504)    (6,683) 
  2001 (unaudited)                                                            
 
 
 
 
 
11. Acquisitions and disposals 
 
On 1 October 2000, SAB International Asia BV, through its 60% held
subsidiary, SAB India , acquired 100% of the business and assets and
liabilities of Narang Breweries Limited situated in the Uttar Pradesh
Province of India. 

The net assets acquired amounted to approximately US$2 million (R12 million)
for a total consideration of US$6 million (R44 million), of which US$2
million (R7 million) was paid in the previous year. Goodwill arising amounted
to US$4 million (R29 million). 
 
 
Shares purchased from minorities comprise of the following: 

                                                           
                                             US$m       Rm  
                                                           
                     ABI                       73      531 
                     PU option tranches       332    2,435 
                     Botswana                  15      111 
                     Tanzania                  27      200 
                     Kenya                      6       46 
                                              453    3,323 
 
The capitalised goodwill arising out of these investments amounted to US$343
million (R2,513 million) 
 
 
12. Post-balance sheet events  
 
Castel Group 
 
SAB, through its subsidiary, SAB International, and the Castel Group through
its Beer Division ('CBB'), have entered into a strategic alliance, with
respect to their operations in Africa (excluding South Africa and Namibia).
The transaction became effective on 1 April 2001, on satisfactory completion
of an operational due diligence by both parties. 
 
As part of this transaction SAB acquired a 20% stake in CBB, whilst the
Castel Group acquired a 38% stake in SAB International Africa, effectively by
way of share exchange. A shareholders' agreement governs the arrangements
between the parties.  
 
US Dollar Private Placement 
 
Subsequent to the financial year end, on 9 April 2001, a US$328 million
(R2,622 million) corporate bond was issued in the US private debt market. The
object of this issue was to broaden the debt base of the group as well as
extending the debt maturity profile. This bond has a maturity of seven years
with an average coupon of 8.06% and an average maturity of five years. 
 
China 
 
On 31 May 2001 SAB announced the acquisition of a further three breweries in
China, through its joint venture company, CRE Beverages Limited. The
breweries are Bangchuidao in Dalian, New Three Star in Shangzhi and Sichuan
Emei in Leshan. All three breweries will be funded through a combination of
internally generated cash and local Renminbi debt at favourable rates. 
 





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