just On Call: Cott Corp eyes energy drink momentum
Cott Corporation has said it sees momentum building in its energy drink category as it looks to launch new flavours and recipes by the end of the year.
The firm yesterday (4 August) recorded a drop in profits for the first six months of the year.
For the six months to 3 July, net profits dropped to US$33.8m from $53.6m in the prior year. Net sales slid to $787.6m compared to $805.8m a year ago, while operating profits rose to $64.2m from $56.6m, said the private label soft drinks firm.
However, speaking on Cott’s earnings call yesterday, CEO Jerry Fowden said that April had been a good month for the performance of its energy drinks.
“April was particularly good month for energy and we do believe we have some momentum starting to build behind our energy performance in the US,” Fowden said.
“It has historically been very good for us in the UK and Canada, and we do anticipate that momentum increasing as the year continues on energy as we have a number of new wins, projects and promotions in the pipeline, which will come to fruition and be on the shelf as the year progresses.”
Fowden said that Cott was “pleased” with an energy promotion it had launched yesterday with a large customer and that plans were now to build on that.
“There are a number of events, both building distribution and stronger promotional programmes, and we know with other customers we have new flavours and new recipes set up for taste panels,” Fowden said. “Assuming a normal proportion of those go well, I would anticipate those leading into additional listings across the third and fourth quarters.
“I think we’re heading in the right direction, we’re getting a bit of momentum and we’re on a bit of a roll when it comes to energy,” he added.
And despite a drop in first-half group sales and profits, Fowden said he sees the landscape for Cott as “more attractive” going forward.
“We have seen a bounce back in our business,” he said. “Our business for July is certainly stronger than it has been in the second quarter, we’re in a position where we’re running flat out in all of our facilities to try and keep up with increased demand.
“Therefore when you couple that with the fact that our comparables get easier in quarter three and quarter four, I hope I don’t have to eat humble pie, but we are looking for our performance to show a step in the right direction as we go forward for the rest of the year,” he added.
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