C&C plan to 'reposition' Magners cider

DRINKS GROUP C&C hopes to grow volumes of its cider Magners next year after it managed to stabilise sales volumes over the six months to the end of August, the company said yesterday.

C&C said it intended to “reposition” the Magners brand in its core market in Britain next summer in the wake of competitive pressures.

The company indicated that trading in autumn has been difficult after a decent June and July saw volumes of Magners sold in pubs return to growth for the first time since May 2007.

The company also indicated that a sum of €8 million earmarked for the promotion of its cider brands would be reviewed following its acquisition of Scottish lager brand Tennents, with marketing spend deployed “where we believe we can get the best returns for shareholders”.

C&C yesterday reported a 10.5 per cent drop in revenue to €257.5 million and a 13.6 per cent fall in operating profit to €57.4 million for the first half of its current financial year, compared to the same period in 2008.

However, its management team, which joined C&C from Scottish Newcastle in November 2008, gave a relatively upbeat outlook statement to investors despite what it said were “challenging” market conditions.

C&C chief executive John Dunsmore said its full-year earnings would be “at the top end” of its previous guidance to the market, which was €77-€82 million.

Overall, cider volumes were level, with Bulmers flat in Ireland and a 2 per cent decline in Magners volumes in Britain offset by growth internationally and in Northern Ireland.

Mr Dunsmore said C&C was happy to have secured level volumes of Bulmers cider in Ireland year-on-year in the context of a tough economic environment and a long-alcoholic drink market that declined by 11 per cent over the period. However, revenues from the stabilised volumes declined 4.2 per cent to €90.3 million after C&C reduced the price of a Bulmers pint bottle by 10 per cent.

He said the launch of pear cider in Ireland and Britain had performed ahead of expectations.