UK: AG Barr's failed Britvic merger dents H1 profits
- First-half net profits fall 12.9% to GBP10m
- Net sales rise 5.8% to GBP128.7m
- Operating profits down 12.3% to GBP13.6m
- H1 volumes up 4.2%
Barr has felt the effects of its failed merger with Britvic
Net profits in the six months to the end of July fell by 12.9% to GBP10m (US$16m), the Cumbernauld-headquartered company said earlier today (23 September). Sales in the period rose by 5.8%, however, to GBP128.7m.
Operating profits were down 12.3% to GBP13.6m.
The group said “professional and legal costs” associated with the merger in the six months totalled GBP2m, while the full cost of the proposed tie-up, including in prior periods, was GBP4.9m. The merger, first announced last November, collapsed in July after Britvic rejected a sweetened offer from Barr.
Excluding these costs, written off as 'exceptional items', Barr's H1 per-tax profits rose by 12.3% to GBP16.6m.
During the period, the company said the soft drinks market had “benefited from the excellent summer weather”, but “competition remains intense”. Barr's volumes were up 4.2% in the period.
“We successfully navigated the challenging market conditions in the early part of 2013 and have accelerated our growth in the second quarter,” said chief executive Roger White.
Looking ahead, the company said it is “confident” of meeting its full-year expectations.
Production at its new facility in Milton Keynes has started, it added.
Shares in Barr were today trading up 1.9% at GBP5.35.
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