Conditions in the cider market remain "challenging", drinks group C&C said today, but the company said it was on target to deliver profit in line with guidance.
The group forcast operating profit would be at the top end of a range of €77 million to €82 million, and said it expected a modest year-on-year decline in cider volumes for fiscal year 2010.
In an interim management statement today, the group said revenue in the three months to November 30th, 2009, revenue fell 9 per cent on the same period in 2008. This was excluding the the impact of the acquisition of the Tennet's brand, which was completed in September for £180 million (€205 million).
Revenue at the cider division fell 13 per cent, while spirits and liqueurs fell 4 per cent. In the distribution division, revenue rose 7 per cent. In Britain, cider revenues fell 17 per cent, while the Republic saw a 13 per cent decline.
Cider volumes fell 9 per cent, with a 15 per cent decline in Britain, a 7 per cent fall in the republic of Ireland, and a rise of 8 per cent in the rest of the world. Spirits and liqueurs volumes rose 2 per cent.
In the nine months to November 30th, revenue fell 7 per cent on the same period in 2008. In the cider division, revenue declined 8 per cent, with a 12 per cent fall in the British market outstripping a 7 per cent decline in the Republic, while spirits and liqueurs fell 14 per cent overall.
However, cider volumes in December were 3 per cent ahead of the previous year, with Britain showing a 17 per cent rise as late ordering from the trade had a positive impact. Volumes in the Republic declined 8 per cent, but C&C gained market share, while the rest of the world showed a fall of 1 per cent.
In November, C&C announced it would buy the Gaymer Cider Company, a transaction that is expected to be completed by the end of this month. However, C&C said its latest acquisition would probably not "contribute meaningfully" to operating profit for the fiscal year, which ends in February.
Meanwhile, Tennent's is expected to contribute €7 million in operating profit in the fiscal year 2010, ahead of expectations.
C&C has also concluded an agreement with Molson-Coors UK (MC) for the distribution of Magners Cider, which will see C&C take over the distribution of Magners to the on trade in Scotland and to multiples in the on trade in England and Wales. C&C will pay a compensation fee of £1.75 million (€1.95 million) to MC.
Shortly before 3.30pm, shares in C&C were trading slightly off, down 0.17 per cent to €2.80.
