Irish unit weighs on Britvic
Pretax profit and revenue rose at drinks group Britvic, but the company reported a full-year loss after incurring writedowns and restructuring charges at its Irish unit.
The group posted a net loss of £48.2 million in the 53 weeks to October 3rd after it said it took a non-cash exceptional impairment charge of £104.2 million at Britvic Ireland. Over 52 weeks to September 26th, that loss was £51.4 million.
Britvic said it would be reviewing the scale and effectiveness of its Irish operation, but said it was "fully committed" to the business.
The company described the Irish market as "challenging" in 2010, with the soft drinks sector declining.
"The economic challenges in Ireland are well documented and have had a material impact on the performance of the Ireland business unit. Both revenue and margin have come under severe pressure as retailers and manufacturers respond to the changing consumer environment," the company said.
"We believe some of these factors will have a longer-term impact on the market and this has led us to write-down the carrying value of intangible assets and properties by £104.2 million as a non-cash exceptional charge."
Pretax profit for the group was £109.1 million in the 53 weeks, and was 21.5 per cent higher than the 52 weeks reporting period. Group revenue, excluding its unit in France which it acquired in May, grew by 5.9 per cent to more than £1 billion. This growth was driven by the GB and international business.
Revenue at Britvic International rose 15.2 per cent as the company expanded its product portfolio and made gains in the export and travel sectors.
The board is proposing a final dividend per share of 12.0p. This brings the full-year dividend per share to 16.7p, a rise of 11.3 per cent compared to a year earlier.
"Britvic has again demonstrated its ability to grow the business despite the difficult conditions in the wider economy," chief executive Paul Moody said, adding that the integration of Britvic France into the group is on track.
"We are taking further steps to restructure our business in Ireland and believe that this, along with our strong brands and leading market positions will create a platform to enable us to rebuild the profitability of this business."
Mr Moody predicted "robust" results in the year ahead.