Wednesday 17 January 2018

Britvic Ireland boss calls for 'balance' over sugar tax plan

Kevin Donnelly of Britvic Ireland
Kevin Donnelly of Britvic Ireland
John Mulligan

John Mulligan

The managing director of drinks firm Britvic Ireland said he "has a problem" with just food and beverages being targeted by the government in an effort to tackle obesity.

Kevin Donnelly said that one of the main contributors to obesity is a lack of physical activity.

While he praised the government for addressing the issue, he said a "much more comprehensive package" is needed. "There needs to be intervention, but we need a balanced approach. One thing isn't going to solve this," he said, adding that he didn't want the sugar levy to end up being a "tax on Irish jobs".

Mr Donnelly also said that he's concerned post-Brexit that sugar taxes are levied equitably so as not to disadvantage companies that bottle here. Britvic Ireland, whose brands include MiWadi and Ballygowan, bottles both in Ireland and the UK.

Finance Minister Michael Noonan announced in October's Budget that a tax on sugary drinks will be introduced in 2018. He conceded that the sugar tax in Ireland and the UK need to be aligned. The UK also plans to introduce a sugar tax in 2018.

Britvic Ireland said that 60pc of its sales are now in the low or no sugar segment. It has been developing and expanding its range of such products in recent years. Mr Donnelly was speaking to the Irish Independent as Britvic Ireland reported revenues of £131.7m (€154.4m) for the 53 weeks ended October 2. That was 5.8pc higher on a constant currency basis. The business - a unit of Britvic plc - covers the entire island of Ireland. Its volume growth was 3.6pc.

Mr Donnelly said that Brexit poses a number of challenges, but that the company has engaged in "scenario planning" to address the issue.

He revealed that the company has agreed to buy East Coast Suppliers, the second-largest licensed wholesaler in Ireland and said the deal is a vote of confidence in the outlook for Britvic's Irish business.

Britvic plc reported revenue of £1.4bn (€1.6bn) for the financial year, and a profit of £114.5m (€134.5m)

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