UK: Britvic FY profits hit by Fruit Shoot recall

• FY net profits dip by 19.3% to GBP62.9m (US$100.8m)
• Net sales down by 2.6% to GBP1.26bn
• Operating profits (EBITA) slid by 16.5% to GBP112.7m 
• Fruit shoot re-entry plan “on-track” 

Britvic has reported a slide in full-year profits as the business took a hit from the recall of its Fruit Shoot product in the UK.

Net profits in the 12 months to the end of September dipped by 19.3% to GBP62.9m (US$100.8m), the company announced today (27 November). It comes after the company confirmed its plan to merge with AG Barr earlier this month. 

Britvic said net sales in the 52-week period fell by 2.6% to GBP1.26bn. Operating profits (EBIT), meanwhile, slid by 16.5% to GBP112.7m. 

The company said that fiscal 2012 had been a “challenging” year, but pointed to an increased market share in the UK soft drinks market and for its syrup brands in France.

However, the year was dominated by the recall of Fruit Shoot in July, after an issue with a newly-launched cap. The overall financial impact is expected to be between GBP15m to GBP20m, Britvic said. Re-supply of Fruit Shoot has begun and the group hopes to return to production levels in line with previous demand by January. 

Britvic also flagged the tough economic conditions in its core markets of Great Britain, France and Ireland for the performance. 

Chief executive Paul Moody said: “This has been a difficult year for the group and the progress that we made was more than offset by the impact of the Fruit Shoot product recall.” 

He added: “The Fruit Shoot product recall was regrettable, but necessary in order to protect the safety of our consumers.” 

Moody is retiring as the company's chief executive in the wake of its merger with AG Barr. The merger remains subject to shareholder and regulatory approval.

Shares in Britvic were today down by 1% at GBp396.