Britvic, the second biggest UK soft drink maker, is attempting to fuel growth after the country’s wettest summer on record hurt revenue last year, and bans on indoor smoking cut into pub sales of sodas. The company spent about £170 million to buy the unit of Dublin-based C&C, adding Ballygowan mineral water and becoming PepsiCo Inc.’s Irish bottler.
“It’s been a challenging environment for them,” said Altium Capital Analyst, Wayne Brown, but added that the worst was over.
Britvic held its annual meeting on 30 January and disclosed that the sales include a £49 million contribution from its Irish unit for 2007’s last quarter. Growth in total sales increased from 5.7% in the fiscal year through September, which included only five weeks of revenue from the acquired division.
The company has recently introduced non-carbonated beverages such as Robinsons Smooth Juice, as concerns about obesity spurred some Britons to avoid sugar-laden sodas. Market share gains for Robinsons helped UK sales of still products to rise 1.2% in the quarter as the market shrank by 1.7%, Britvic said.
Revenue from carbonated beverages gained 0.4%, compared to total market growth of 2.5%, Britvic said.
“We remain confident about the delivery of market expectations for the year,” Chairman Gerald Corbett said in the statement. Operating margins were steady compared with a year earlier, he added.
The company has forecast annual pretax savings of about €14 million from buying the C&C unit. Costs to the rest of its business will total as much as €25 million over three years, CEO Paul Moody has said.
© FoodBev Media Ltd 2020
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