Britvic sees falls in annual revenue and adjusted earnings due to pandemic
Group revenue declines 8.6% over year as restrictions continue
The Covid-19 pandemic has impacted Britvic’s out-of-home sector
Ballygowan-maker Britvic said annual revenue declined and adjusted earnings fell as the pandemic hit its Irish and British businesses.
The group, which includes Miwadi, Pepsi, Robinsons and 7UP among the brands it distributes in Ireland and the UK, said revenue for the year ended September 30th was £1.4 billion, down 8.6 per cent compared to a year earlier.
The company benefitted from an increase in time spent at home, with the Irish business seeing a strong performance in MiWadi and Pepsi. However, a weaker bottled water category hit sales of Ballygowan.
The group’s adjusted earnings before interest and taxation were 22 per cent lower at £165.8 million. Profit after tax rose almost 17 per cent to £94.6 million. Adjusted earnings per share fell to 43.2 pence. Net debt fell by £45.8 million over the year.
Britvic said it would pay a full-year dividend of 21.6p, maintaining its 50 per cent pay-out ratio.
The drinks group started the year reporting first-quarter revenue that was 2.6 per cent ahead of last year, but as the Covid-19 pandemic hit that increase in revenue slowed to 1.4 per cent at the half-year mark.
The third quarter saw a decline in revenue of 16.3 per cent. There was some improvement when restrictions began unwinding, with revenue in the fourth quarter narrowing that loss to 11.3 per cent. Trading restrictions and social distancing continue to impact the out-of-home channels.
“Even though out-of-home trading has inevitably been impacted, we have continued to gain market share in our key growth markets of GB and Brazil, and we have successfully protected cash and our overall financial strength,” said Simon Litherland, Britvic chief executive.
“At the same time we have also made considerable progress executing our strategy, and we are well positioned to drive future growth and returns. We have extended our GB carbonates relationship with PepsiCo to 2040, and expanded our presence in the energy category through the addition of their Rockstar brand.
“We have accelerated our sustainable business commitments and completed the disposal of non-core assets in France, which will result in more focus on growing our higher margin brands there.”
Its British at-home channel gained market share and saw value growth of 11.3 per cent, led by core brands Pepsi, Robinsons, 7UP and Tango.
Brazil saw a record performance in both concentrates and ready-to-drink juice, and France returned to growth in the fourth quarter.
“While 2021 will bring continued uncertainty it also presents real opportunity for Britvic to capitalise on the trends which have accelerated as a result of the pandemic,” said Mr Litherland.
“ We are confident that we will continue to react with agility and pace as events unfold. Soft drinks has repeatedly proved itself to be a highly resilient category, and we fully intend to be at the forefront of its recovery.”