Thursday 24 October 2019

C&C stockpiled €3m of cider in Brexit run-up

Sales of Magners in Spain and France were hit during C&C's last financial year. Photo: Peter Byrne/PA
Sales of Magners in Spain and France were hit during C&C's last financial year. Photo: Peter Byrne/PA
John Mulligan

John Mulligan

Bulmers owner C&C spent €3m stockpiling cider in the UK prior to the original March Brexit date, and will likely repeat that at the beginning of the autumn before the UK exits the European Union at the end of October, according to chief financial officer Jonathan Solesbury.

One of its UK-based distribution units - Bibendum - also had between €3m and €4m of fine wines stockpiled at the end of March in anticipation of Brexit.

Mr Solesbury also said that C&C stockpiled €500,000 of raw materials in the run-up to the expected Brexit date in March. He told the Irish Independent the cider stockpiles are being wound down, but will be repeated later in the year. The stockpiles of wine won't be wound down, he added.

Mr Solesbury said stockpiling cider in the autumn will be "less of an issue" for C&C as it will have passed the key summer trading period for the product.

Sales of Magners in Spain and France were hit during C&C's last financial year due to a combination of increased competition and fewer British tourists visiting the countries due to Brexit uncertainty.

But C&C's results for the year to the end of February were boosted by the performance of the Matthew Clark and Bibendum distribution arms in the UK, which were acquired by the group in April last year.

C&C chief executive Stephen Glancey
C&C chief executive Stephen Glancey

C&C shouldered debt attached to the units, injected capital and settled outstanding tax demands the businesses had.

Revenue at C&C - which also owns brands including Tennent's and Five Lamps beer - almost tripled to €1.57bn in the period, which included just over €1bn in turnover for 11 months from Matthew Clark and Bibendum.

Revenue at the core C&C drinks business was €564.4m, representing a 3.2pc organic uplift. Adjusted earnings before interest, tax, depreciation and amortisation (ebitda) at the core business was €101.7m - a 1.4pc organic increase. Matthew Clark and Bibendum delivered combined adjusted ebitda of €18.3m.

C&C chief executive Stephen Glancey said Bulmers increased its share of the Irish cider market to slightly more than 60pc in the financial year, boosted by hot weather, and despite competition from cider products owned by its much larger rivals, Diageo and Heineken.

He said that non-alcoholic Bulmers will be launched for this summer in Ireland.

Mr Glancey also added that he doesn't expect minimum alcohol pricing to be introduced here for between 12 and 24 months because it has to happen in tandem with Northern Ireland.

"It won't happen until you've got a devolved government back in the North," he said.

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