Britvic's €122.3m writedown pushes firm into loss
Published 03/12/2010 | 05:00
THE head of Britvic yesterday refused to rule out more pay cuts and job losses at its Irish operations, after the company took an impairment charge on its business here of more than £100m, pushing the company into a loss overall.
The drinks company wrote down its Irish business by £104.2m (€122.3m) amid a continuing deterioration of the Irish market.
Around £77m worth of goodwill has been written down while the balance is made up of reduction in property values.
The writedown -- the first of its kind since Britvic bought C&C's soft drinks unit for €249m in 2007 -- pushed the Britvic group into a loss overall. Britvic also took a £5.4m restructuring charge in Ireland.
Chief executive Paul Moody refused to be drawn on what effect a previously announced restructuring programme may have on Britvic Ireland. The company, which employs 800 people here, will announce what form the restructuring will take in the new year.
"It's a work in progress at the moment. We're in a period of consultation so there's a lot going on behind the scenes," he said.
For the 53 weeks to October 3, Britvic booked a net loss of £48.2m despite revenue increasing 16pc to £1.14bn. Last year the company made a profit of £46.8m. Shares plunged on the results, diving 10pc early on before recovering slightly to close at 478.4p, down 2.5pc.
"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," said Mr Moody.
Despite the losses, Mr Moody reiterated that Britvic were committed to Ireland.
"We have invested millions here and the Kylemore business is very much part of our group infrastructure. Our factories here are also producing goods for the UK market as planned. We have no plans to leave."