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Drinks supplier and distributer C&C Group has announced the departure of its CEO after posting delayed accounts due to the discovery of accounting errors.

CEO Patrick McMahon was CFO during the periods in which these accounting errors were made and “acknowledges that the relevant shortcomings occurred at a time when he had overall responsibility for the group’s finance function”.

Therefore, he will step down as CEO  with immediate effect, although will remain an employee until the end of September to facilitate a smooth transition. 

In addition to his duties as chair of the board, Ralph Findlay has been appointed group CEO with immediate effect to ensure continuity of executive leadership.

It is expected that he will remain in post as group CEO for between 12 and 18 months, subject to the timing of the recruitment of a long-term successor, with the relevant search to commence in the autumn. 

The adjustments to historic accounts amount to €5m, going back to 2021.

Meanwhile, the group has posted delayed unaudited accounts that show a sharp drop in profits following disruprtion to its distribution business.

The group expects to report net revenue for the year to 28 February of €1.65bn, representing a 2% decline.

The group said the implementation of a complex ERP system upgrade in its Matthew Clark and Bibendum business had a material impact on the performance of the GB distribution business and, as a consequence, group performance.

Nevertheless it said it was “pleased” with the performance of key brands, with Tennent’s and Bulmers continuing to gain share in Scotland and the Republic of Ireland respectively.

It said premiumisation remains a strategic focus and its premium beer brands in GB delivered volume growth of 24% in the year.

However, Magners volumes in GB declined 18%, which resulted in a non-cash exceptional charge of €125m.

Operating profit before exceptional items in the year is expected to be €60m, down from €82m.

However, the exceptional charge will see the group post a statutory pre-tax loss of €111m in the period, down from a profit of €52m.

The group said that trading in the first quarter of its new financial year has been “encouraging” and is in line with expectations.

“The group is well placed to take advantage of the critical summer period ahead, including the Euro tournament which includes the participation of the Scottish and English football teams,” it stated.

“Whilst we remain cautious about the consumer outlook for the year, the market dynamics indicate that consumers are seeking affordable treats including visits to pubs and restaurants. At this stage therefore there is no change to our expected earnings for FY25 and future years.”

Morning update

On the markets this morning, the FTSE 100 is down 0.3% to 8,259.9pts.

Fallers include C&C Group, down 7.2% to 157p, Bakkavor, down 1.4% to 142p and PZ Cussons, down 1.3% to 108.6p.

The few risers include WH Smith, up 0.3% to 1,171p and Nichols, up 0.1% to 1,016.3p.

Yesterday in the City

The FTSE 100 gained 0.5% yesterday to close up at 8,285.3pts.

Risers include THG, up 4.1% to 71p, Greencore, up 3% to 174p, Bakkavor, up 2.1% to 144p, Diageo, up 2.1% to 2,712.5p and WH Smith, up 1.7% to 1.167p.

The day’s fallers include Nichols, down 2.9% to 1,015p, Sainsbury’s, down 2.3% to 267.6p, B&M European Value Retail, down 2.2% to 495.6p, PayPoint, down 1.8% to 560p and Greggs, down 1.7% to 2,878p.