How did Britvic perform in fiscal-2019? - results data - just-drinks comments

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  • Full-year sales rise 1.4% to GBP1.55bn (US$1.99bn)
  • Carbonate sales in the UK during 12 months to end of September jump 5.2% to GBP663.6m
  • France provides headache, sales down 9.2%

Britvic has posted a low-single-digit lift in sales from its latest fiscal year, reversing the top-line decline recorded in the group's third quarter.

Britvic saw its full-year sales increase by 1.4%

Britvic saw its full-year sales increase by 1.4%

The UK-based company said earlier today that sales in the 12 months to the end of September neared the US$2bn barrier. The 1.4% improvement comes four months after Britvic reported a 1.5% sales fall in the three months to 7 July, on the back of H1's 1.9% increase.

Britvic 2019 - Sales by Region - Value

Source: Company results

In its home market, where Britvic controls PepsiCo's namesake cola brand, sales from the carbonated portfolio were strong, climbing by just over 5% (excluding the Soft Drinks Industry Levy). Low- and no-sugar offerings more than compensated for decreasing sales from full-sugar brands. The company noted in today's announcement that Pepsi Max, which contains no sugar, is currently the "biggest cola variant" in the country, based on volumes. Britvic's still drinks stable in the UK lived up to its name, coming in flat.

Over in France, the group struggled to deal with the introduction of the 'EGalim' law earlier in the year. The legislation, which links the payment of fairer prices to farmers with the strengthening of product quality, resulted in Britvic having to take price in the country, leading to lower volumes in the off-premise channel. Britvic also updated on its intention to sell three production facilities, its private-label juice business and the Fruité brand to Refresco. The transaction, announced this month, is expected to complete early next year, the company said, with Britvic retaining the Teisseire and Moulin de Valdonne brands, as well as its private-label syrups business in the country.

Further afield, and Brazil was within a whisker of delivering a double-digit sales increase, while the International reporting region did just that, climbing 10.2% in the year. Britvic flagged, however, that its Fruit Shoot multi-pack offering will be withdrawn in the US, with the focus switching to the single-serve packaging option.

Britvic 2019 - Sales by Region - Volumes

Source: Company results

CEO Simon Litherland

"I am pleased to report that Britvic has once again delivered a strong performance, with good momentum in our key brands and categories. In 2019 we have increased revenue, adjusted margin and EBIT, as well as significantly improving free cashflow generation. Our commercial execution, innovation agenda and revenue management continue to deliver results. Our transformational business capability programme is now complete - and importantly forms a key part of our broader commitment to building a more flexible and sustainable business model going forward.

"Building on this strong platform, I am confident that Britvic is well placed to capitalise on the future growth opportunities in the years ahead. While we anticipate conditions to remain challenging, we fully expect that we will make further progress in 2020."

To read Britvic's official full-year results announcement, click here.

Are full-sugar soft drinks the new niche? - Click here for a just-drinks comment

just-drinks thinks...

Britvic's bounceback into sales growth following a downbeat third quarter should not be overshadowed by the goings-on in France. The group's writedown on operations in the country, where a recent law change coupled with a pending asset offload hampered the bottom line, may grab the headlines, but the sales lift from its carbonates portfolio in the UK is impressive.

With the carbonated soft drinks category being buffeted by both the sugar tax and the firmly-established 'health & wellness' trend among consumers, Britvic should be rightly proud of the 5.2% top-line jump from CSDs in its home market. The performance shows there is room for growth in the UK, despite its mature-market status and the associated challenges.

Expert Analysis

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