The new 150ml can format has helped drive distribution in the UK

Shares have soared more than 12% at Fever-Tree (FEVR) today as UK demand for its posh mixers showed no sign of slowing, with first-half profits more than doubling.

The business upgraded its full-year forecasts on the back of another period of significant growth and now expects profits to be “materially ahead” of expectations.

It has repeatedly smashed forecasts since becoming a public company in November 2014, with shares rising more than 1,000% in value as a result.

The stock has leapt 12.5% so far during today’s trading to 1,965p, valuing the business at £2.3bn, compared with £154m when the group floated on the London Stock Exchange at 134p a share.

Sales in the six months to 30 June increased 77% to £72m, with pre-tax profits up 104% to £24.1m, compared with £11.8m in the same period of 2016.

Fever-Tree has been driving its international business hard in the last couple of years, with growth of 64% across continental Europe, 43% in the US and 45% in the rest of the world, but the core UK market contributed most to the first-half performance.

Sales in the domestic market jumped 113% to £33.6m thanks to “exceptional” trading in the on and off-trade. Distribution gains continued to fuel the UK performance, with the 150ml can format proving a hit with supermarkets and c-stores.

Fever-Tree has expanded distribution of the format, added new flavours and won a listing across the Virgin Atlantic fleet from this month.

CEO Tim Warrillow told The Grocer today that the supermarkets are planning to give the brand more space in stores to capitalise on the booming demand for its products as the premiumisation trend continue to gather pace.

“We are delighted with the first-half performance – as indeed are the retailers,” he said. “The supermarkets are looking at giving us more space and more SKUs. The exciting thing is when we look at the people who are buying Fever-tree we are getting a lot of young people who are coming into the category for the first time.

“About 17% of customers are new arrivals who have never shopped in this category before and they are going straight in at the premium end, which proves just how healthy the category. The supermarkets also point out to us that customers are buying mixers to consume with soft drinks as well as gin, vodka and rum.”

He added that the UK mixer category was “overlooked, forgotten, commoditised and declining” when the business was founded in 2005. “It [the category] is now the fastest growing soft drinks category, with growth of 17% in the first half of 2017. Fever-Tree was responsible for 99% of that off-trade growth, and with a market share of 30% there is plenty more room for expansion.”