UK: Britvic issues confident update, despite tough trading conditions
Britvic has seen revenues lift in the run-up to Christmas, despite the slowdown in consumer spending and the impact of the smoking ban in the UK.
At its AGM today (30 January), the soft drinks company reported total revenues of GBP214m (US$426m) for the 12 weeks to 23 December last year, an increase of 31.2% on the prior year.
Sales included a first-time contribution from Britvic Ireland of GBP49.3m for the three months to the end of December. UK and international revenues grew by 1.1% during the period, with stills growth of 1.2%, carbonates flat at +0.4% and Britvic International growth of 12%.
The company said that sales growth in the UK were driven mainly by volume.
In the quarter to November, the company said that on-trade soft drink market volumes were down 5% due to trading conditions being affected by the smoking ban and consumers spending less. In the off-trade however, volumes were up 0.3%, driven by the growth of CSDs, while stills volumes were down in a market where "the rate of decline ... has fallen consistently over recent months".
Britvic's International division showed "strong growth" driven by its Fruit Shoot brand in the Netherlands and distribution gains for its Robinsons squash in Sweden, Finland, and Denmark, the company said.
Britvic Ireland's revenue grew 5.6% for the quarter to the end of December, benefiting from exchange rate movements. Alongside a decline in off-trade performance, the on-trade market remained strong, driven by growth from brands including Miwadi and Ballygowan.
"The integration of Britvic Ireland and the delivery of the forecast EUR14m synergies remains on track," said Britvic.
Corbett added: "Despite current trading conditions and pressure from rising input costs experienced in the first quarter, our continued strong focus on cost control has maintained our operating margins compared to the same period last year.
"With an expected return to growth in the near term for the stills category, plus this year's innovation programme to be launched soon, we remain confident about the delivery of market expectations for the year."
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