Britvic 'cautious' about Irish market

Irish sales at drinks group Britvic rose in the third quarter of its fiscal year, slowing the decline in revenues for the year to 5.7 per cent.

However, the company said it was cautious about the figures, warning it did not mean there would be a sustained recovery in the industry.

Britvic Ireland’s sterling-based revenues rose 8.6 per cent in the quarter, with volumes up 15 per cent. This compares with a grocery soft-drink volume increase of 5.8 per cent.

"However, both the volume and ARP performance was flattered by the phasing of sales across April in 2010 versus 2009," the company said in a statement.

The timing of Easter contributed to the figures, as did the the 2010 implementation of Britvic's business transformation programme.

Underlying three-month volume was up 5.3 per cent, while ARP fell 2.5 per cent and revenue rose 1.8 per cent.

"The structural deflation in Irish food & drink categories continues; the Irish soft drinks market remains volatile, with value declining in the ROI grocery soft-drink market by 2.9 per cent in the quarter, and by 11.3 per cent in the ROI licensed on-premise market," the company said in a statement.

"This, together with a relatively soft comparable quarter last year, means that we remain cautious that the latest performance is not indicative of a sustained turnaround in the soft drinks market."

The wider group said it is "confident" of meeting full-year analysts' estimates after reporting increased fiscal third-quarter sales.

Group revenue climbed 16 per cent to £289.5 million, while sales for the year to date rose 8.5 per cent to £794.8 million.

"We continue to remain cautious about consumer sentiment in our trading territories, but as a result of our strong performance in the quarter and in the year to date, the board remains confident of meeting current market expectations for the full 2010 financial year," chief executive Paul Moody said.

Britvic acquired Fruit Enterprises, an independent French soft drinks company, in May for €237 million. It contributed revenue of £23.2 million in June, the company said today.

Additional reporting: Bloomberg