Update - UK: Britvic shares climb on Q1 results
In the UK, Britvic grew sales by 0.8%
The market took an optimistic view of Britvic's first-quarter results today (27 January) as its shares climbed by 4%, despite the UK soft drinks maker experiencing a shaky start to the year.
The firm reported an increase in first quarter sales this morning, and said it remains confident about its full year. In the UK, Britvic grew sales by 0.8%, despite "adverse weather" conditions affecting trading, particularly in the country's off-trade. However, volumes in Ireland fell by 9.9%. Off-trade volumes and value were up up by 2.8% and 0.7% respectively, but on-trade volumes and value both dropped by 7%.
The firm also announced a cut to almost one in seven jobs at its soft drinks business in Ireland earlier this month.
Evolution Securities analyst Simon Hales said that, while headline sales came in below his forecast, which "on the face of it ... looks like a worrying 4% sales miss", the shortfall was down to the first-time consolidation of France.
"France contributed GBP49m of sales versus our GBP60m estimate as the seasonality of the business differed from our expectations," Hales said. "Crucially, having spoken with the CFO, they remain very happy with the underlying performance of the business."
Hales added: "Although management caveat their outlook statement with comments regarding the consumer and cost environment remaining challenging, they are confident about the outlook for the full year. Moreover, input cost guidance for a 5-6% headwind remains unchanged. Bearing in mind these comments, we expect no change to consensus forecasts today."
Britvic shares climbed 4.1% to 467 pence at 14:46pm GMT.
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