C&C maintains expectation of double-digit growth

Drinks group C&C has reaffirmed its guidance for double-digit operating growth in the current financial year.

In an interim management statement issued today, the company said trading over the third quarter had been "resilient" in its core markets in Ireland and Scotland.

Christmas sales had been “satisfactory and in line with expectations”, while international volumes had improved over the third quarter.

The UK market remained challenging, it said, but added that the company was still on target for an operating profit of between €125 million and€132 million this financial year.

Ireland and Scotland, which account for around 63 per cent of the group’s earnings before interest and taxes (EBIT), continue to be important sources of cash generation for the group.

Net revenue in Ireland for the first three quarters of the financial year were up 3.7 per cent, while volumes increased by 3.5 per cent.

Tennent’s UK also performed well in the third quarter, recording an 8 per cent growth in volume.

The UK cider business remains the most challenging division in C&C’s portfolio, according to Davy Stockbrokers. Net revenues fell 17.5 per cent in the third quarter, continuing the downward trend seen in the first half of the year.

Sales volumes of beer and cider continued to grow in Europe, while the focus in the US was on brand-building and the reorganisation of distribution.

“The interim management statement contains little by way of surprise, with commentary on divisional trading along expected lines,” Davy said in a note.