Irn-Bru maker AG Barr (BAG) has enjoyed a 10% jump in full year pre-tax profits as sales grew across all its core brands.
Profit on ordinary activities, before tax and exceptional items, increased by 10.0% to £41.9m for the 12 months to 25 January. Total turnover increased by 2.7% to £260.9m, while sales were up by 3.3% when stripping out sales of the Orangina brand it stopped producing during the year.
All its core brands – Irn-Bru, Barr, Rubicon and Strathmore – were in growth, with particularly strong performance coming from its stills segment and Strathmore water.
Roger White, Chief Executive, commented: “We have delivered an excellent financial performance in difficult market conditions over the past 12 months, whilst continuing to build the platform required for sustained and profitable long-term growth.”
He did warn the market conditions will remain “challenging” and that the UK soft drinks market is “experiencing a period of price deflation which will, if sustained, make it more difficult for many businesses to deliver the top line growth of recent years”.
He also cautioned that the company had had a slow start to 2015 “reflecting tough comparative trading and promotional phasing”.
AG Barr shares are down 2.4% to 661p in early trading on the back of its gloomy outlook. Associated British Foods (ABF) has also opened significantly lower (1.8% down to 2,957p), while Imperial tobacco (IMT) continues its rises from yesterday, climbing another 0.9% to 3,193p.
Elsewhere, British American Tobacco (BATS) has picked KPMG as its auditors after parting ways with PricewaterhouseCoopers – the accountancy firm under fire for its part in Tesco’s profit overstatement. The relationship ended in March, with BAT reportedly taking PwC to court over a potential $1bn bill for damages related to US pollution.
UK-listed Russian supermarket chain Lenta has completed a US$225m equity placing an equity to allow it to expand more quickly than previously announced. The placing will enable it to open at least 25 new hypermarkets in 2015 versus previous guidance of 20-25 and remain on target to double selling space over the three years to 2016.
Yesterday in the City
Finsbury Food Group (FIF) leapt 5.8% higher yesterday to 73.5p after the cake and bakery reported a 24.1% jump in first half revenues
Premium drinks mixer supplier Fever-Tree (FEVR) also reported strong growth yesterday, with its full year earnings and profit both rising by just under 50%. However, its shares fell back 0.3% to 213.3p largely because the strong results had already been factored in to the company’s rising share price. The shares are up by around 25% since its November AIM IPO.
Elsewhere, the tobacco companies were on the way back up after taking a hit last week from the pledge of US billionaires Michael Bloomberg and Bill Gates to create a fund to help small countries trying to regulate tobacco sales. Imperial Tobacco was up 1.9% to 3,165p and British American Tobacco was up 1.3% to 3,703.5p.
AG Barr had a strong Monday ahead of its widely expected profits boost announced this morning – climbing 2.6% yesterday to 677p. Premier Foods is also having a better time of things recently, rising 3% to 43.5p after broker Jefferies identified positive recent sales trends for its brands.