C&C Group reaffirms profits guidance

C&C Group reaffirms profits guidance

Stronger demand for Magners cider during a spate of hot weather in the UK has helped to insulate C&C Group from problems elsewhere in its portfolio in its fiscal first quarter.

Magners volume sales rose by 15% for the three months to the end of May, C&C Group said in a trading update today (29 June). The performance, which rode on the back of hot weather and an extra public holiday in April, helped C&C to reaffirm its full-year operating profits guidance, at a range of between EUR108m (US$115m) and EUR115m.

However, problems remain for the Ireland-based group. Net sales on Magners rose by 11.5%, representing a slower-paced increase than that for volumes, albeit a strong improvement on the previous year.

The company faced a similar issue on Bulmers in Ireland, which reported volumes up by 3% but net sales down by 3% for the three-month period.

C&C's total cider sales fell by 7% in volume and by 0.4% in value, dragged down by double-digit declines on the Gaymers brand. "In Gaymers, a reduced level of activity at the lower margin end of the portfolio contributed to a 15% decline in net revenues," said the group.

Beer, led by the Tennent's brand, performed much better for C&C, with volumes up by 7% and net sales up by 12% for the quarter.

In its outlook, the firm sounded a cautious note: "Trading in June has been relatively weak in comparison to the prior year with poor weather in Ireland and the UK adding to the challenge of last year’s World Cup comparatives."

For the company announcement, click here.