Poor weather hits Britvic sales

Poor weather in June and weakening consumer spending hit the soft drinks market in the third quarter, Britvic said, causing a contraction in the Irish market that weighed on results.

The market performed in line with expectations until the final four weeks, when weather conditions turned to the coolest since June 2001. Both British and Irish soft drinks markets contracted sharply in both volume and value during June, with volume down 8.2 per cent in the latter compared with the previous year. In Ireland, the market fell more shareply, declining 13.2 per cent.

Group revenue for the quarter was 12.2 per cent higher, as the French unit lifted results. Excluding Britvic France, revenue was 1.8 per cent lower for the quarter, weighed down by a 15.3 per cent fall in Irish revenue.

In the GB unit, revenue grew 0.7 per cent, although underlying voilumes declined 2.5 per cent. The carbonates sector was 4.4 per cent higher in terms of revenue, but still fell by 4.2 per cent as Robinsons switched from single to double concentrate, and the stills market declined overall.

In France, third quarter revenue was 9.0 per cent higher, supported by a strong performance in Britvic's syrups brands and the launch of Teisseire Fruit Shoot. The international sector saw revenue grow 5.3 per cent.

"During the third quarter, the soft drinks markets in GB and Ireland were adversely affected by the poor weather in June, whilst the comparative period in 2010 was strong reflecting both good weather and the football World Cup," said chief executive Paul Moody.

"Nevertheless, Britvic delivered revenue growth across the GB, international and France business units, although Ireland showed a decline. The actions we have taken to proactively manage ARP and margins against such challenging market conditions underpin the board's current confidence in meeting its expectations for the full year.

"However, we continue to be cautious about the challenging trading conditions and the impact of consumer sentiment in our largest markets as we move into the final quarter of the financial year."