Strong volume growth lifts Refresco’s first-quarter revenue

Volume growth of more than 26% has contributed to an increase in Refresco’s first-quarter revenue.

The bottler saw volumes increase 26.4% to 1.67 billion litres. It meant that revenue was up 17% to €524 million, with pre-tax earnings of €37 million.

Refresco CEO Hans Roelofs said: “We are pleased to report solid first-quarter results. Volume increased this quarter on a reported as well as a like-for-like basis, significantly outperforming the market. Volume growth in co-packing was a combination of organic and acquisitive growth. Private-label developed favourably, largely due to strong private-label volume in the UK where our investments in new customer offerings are paying off.

“Due to the seasonal nature of our business, volume and profit contributions in the first quarter are typically less significant to our full-year results, even more so for the companies we recently acquired.”

Since the beginning of 2016, Refresco has taken over US-based Whitlock Packaging for $129 million, Dutch beverage co-packing business DIS for €72 million, as well as a bottling facility in Germany from PepsiCo that boosted its co-packing activity.

The two headline deals that it undertook in the last 14 months – Whitlock and DIS – represent an aggregate spend of more than $207 million.

Then, last month, the company was forced to fend off a €1.4 billion advance from private equity group PAI Partners – the owner of ice cream manufacturer R&R.

Roelofs continued: “In line with expectations, gross profit margin per litre came down compared to the same quarter last year due to the impact of acquisitions and the weaker British pound. 

“We see ample opportunities to execute our buy-and-build strategy in Europe and the US. At the same time we will continue to look for opportunities to strengthen our market positions via investments in production capacity and innovation.”