Sales tumble but Britvic still committed to Ireland
DRINKS company Britvic said it was staying in Ireland yesterday despite revealing another set of miserable results for its operations here.
In a management statement covering the first quarter of its financial year, the maker of soft drinks such as MiWadi squash and Ballygowan water said sales from its Irish business declined by another 10pc to £37.8m (€45.4m) in the last three months of the year.
In a sign of just how tough the environment is, volumes in Ireland fell only 0.2pc but average retail price was down by 5.3pc "due to both promotional intensity and adverse mix".
In the statement, the company said it "held value share of the take-home market".
Britvic blamed half of the sales decline on the third-party brands, largely alcohol, which the company distributes through the licensed wholesale business where the "on-to-off trade shift was especially marked".
Britvic bought the Tyrone-based wholesaler Quinns last May.
The company has struggled in Ireland since paying close to €250m for the business in 2007.
It has been forced to write down the value of the operation by more than €120m and cut staff and wages -- raising doubts as to whether Britvic would retain the Irish business.
Yesterday, however, a spokesman played down those fears, and pointed to comments made by chief executive Paul Moody in November, reiterating support for the Irish business.
Britvic in Ireland has found itself squeezed by lower prices brought on by plummeting consumer spending. Davy Stockbrokers' Barry Gallagher said the results were mixed.
"While there is a number of events this year that may aid soft drink volume growth (London Olympics, European football championships), our concern is that price/mix will be more challenging to achieve in the coming months as competition continues to intensify, retailers become more demanding and the UK consumer becomes more entrenched.
"Some 85pc of free cash-flow is used to pay this dividend and if conditions were to deteriorate, one could see how the dividend position might become stressed," he added.