Panmure Gordon says Britvics trading has been in line with expectations

Panmure Gordon says Britvic's trading has been in line with expectations

Britvic should produce double-digit EPS growth over the next three years, Panmure Gordon analysts have said, despite the firm highlighting continued troubles in its Irish market.

The UK soft drinks maker reported an increase in full-year sales yesterday (20 October), but conceded that conditions in Ireland remain difficult. The unit experienced a 9.6% drop in full-year sales and an 8.3% decline in the fourth quarter.

Despite this, Panmure Gordon analyst Damian McNeela said the firm's trading update indicates that trading has been in line with expectations.

"GB carbonates continued to benefit from consumers switching out of stills to better valued products," McNeela said. "In Ireland the market remains challenging but France's performance was solid against tough comparatives and its international business continued its strong growth."

International sales were up by 12.8%, while France had a strong year, Britvic said, with high single-digit sales growth.

"We remain comfortable with our forecast for a 2% increase in group (incl. France) EBITA to GBP138m for FY 2011," McNeela said. "Despite the challenging consumer environment, the soft drink category remains resilient returning to growth in Q4 with value increasing 6.9% on volume growth of 2%."

He added: "We expect that the market will continue to be resilient into FY 2012 and anticipate that Britvic's ongoing cost optimisation programmes and new product innovation should deliver low double-digit EPS growth over the next three years."

Britvic said it expects to deliver full-year results in line with expectations. The company will publish its full earnings results on 30 November.

Britvic's shares have declined by 35% year-to-date. Shares were up 5.03% to 323.80 pence at 1130 BST yesterday.