C&C Group has returned to volumes growth in Ireland

C&C Group has returned to volumes growth in Ireland

Earlier today (30 October), C&C Group released its first-half results. Here's a closer look at the company's performance in the six months to the end of August.

Republic of Ireland 

Net sales in the country, excluding the Gleeson Group acquisition earlier this year, were up 2%, while operating profits, excluding exceptionals, were up by 12%. Volumes, again excluding Gleeson, were up by 2.7%, after an 11.5% decline in Q1.

The group's first-half cider sales were up 1%. Volumes also picked up, rising by 2.5% in H1 after a 13% drop in Q1. Beer volumes grew by 4% despite an overall 3% drop in the Irish beer industry. On-trade volumes grew by 25%.

Meanwhile, Ireland's overall Long Alcoholic Drinks (LAD) sector declined by 2% in H1. However, for the first time in seven years, the on-trade outperformed the off-trade, down 1% compared to off-trade's 2% drop, C&C Group said.

UK

Group volumes in the UK cider market improved from a 22% decline in Q1 to a 6% decline in Q2. This resulted in an overall cider volumes drop of 14% in H1. First-half cider sales were down by 18%. “Despite further price investment, the total volume performance reflects the intensity of price competition in the UK market,” C&C Group said of the cider category.

The Magners brand posted a 10% volumes drop in H1, with Q2 volumes down 2%. C&C said it will continue to invest in the brand while reducing operating costs.

Tennent's volumes in the UK fell by 6% against an overall 5% decline in the country's beer market. However, operating profits grew by 9%. Caledonia Best increased volumes by 39% in H1.

International

C&C's international unit in H1 delivered a 77% volumes jump and a 73% sales increase. Vermont Hard Cider Company's Woodchuck brand in the US posted a 3% volumes rise, which was lower than the industry average, C&C said. It blamed the underperformance on a “disruptive” integration process following Vermont's purchase in December. Magners volumes in the US fell by 28% because of “operational changes” in distribution, however C&C Group added that it expects the brand to return to growth in H2.

In Australia, the company said route-to-market problems were preventing the brand from performing “in a vibrant cider market”. The group said it is confident the issue has been resolved and expects Magners to enjoy a “strong” summer season in the country.