AG Barr anticipates sales decrease for H1
AG Barr acquired cocktail brand Funkin in H1
AG Barr has warned that it expects a 5% dip in its half-year sales, compared to the same period last year.
In a pre-close trading update today, the company said: "Half year sales revenue is expected to be circa GBP128m (US$199.5m), which is a drop of around 5% on the prior year." However, allowing for the termination of its contract with Suntory to produce Orangina in the UK last year and its divestment of Findlays, the company said sales will have declined by around 3.5%.
The company said poor UK weather, the impact of its Glasgow 2014 Commonwealth Games activity in the year-prior, and changes to the business had impacted sales in the six months to the end of June.
"Our Business Process Redesign project (BPR) and the subsequent transition to a new company-wide system platform in early-June has, as expected with a project of such scale and complexity, given us some short-term customer service challenges, which have also impacted our overall revenue performance," Barr noted.
During the six-month period, Barr has bolstered its Milton Keynes facility and acquired on-trade juice and puree brand Funkin.
The firm said its financial performance will be weighted to the second half. "Our objective for the second half of the year is to bring improved operational stability and growth to the business and to begin to realise the benefits associated with the changes we have made."
The company will announce its interim results on 22 September.
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