Hi:
I'm not sure what you mean when you say that you are using "Proc report to group by variables", since there was no BY statement in your code snippet.
However, if you look at the SPANROWS option (it goes on the PROC REPORT statement), in some destinations, it will cause row spanning, as you describe.
http://support.sas.com/documentation/cdl/en/proc/61895/HTML/default/viewer.htm#a002473620.htm
I know that it will work for PDF. Whether it will work for Excel depends on whether you are using ODS CSV, ODS MSOFFICE2K, or ODS TAGSETS.EXCELXP to create output files that Excel can open.
cynthia