Bulmers maker C&C reports fall in earnings as cider sales fall
Bulmers cider maker C&C has seen its adjusted earnings before interest, taxation, depreciation, and amortisation fall to €57.6m in the first six months of its financial year, down 4.6pc year-on-year.
Net revenue at the group was down 6.8pc year-on-year to €273.1m, while the group’s operating profit fell by almost 5pc to €50.5m compared to the same period last year, according to the group’s half-year results.
The fall in earnings was driven by flat cider sales in the UK, as well as a fall in sales of Bulmers brands, which were down 5pc year-on-year.
The group also cited the devaluation of sterling, which had put margins and volumes under pressure in certain European markets.
This is likely to remain a feature of the groups business in the near term C&C said.
However, the company did experience strong organic growth in super-premium and craft markets, with volumes of sales rising by 24pc across C&C’s portfolio.
Super-premium and craft portfolio now contributes revenues of €7.8m to the group.
In addition C&C’s operating margins increased 40bps to 18.5pc, driven by improving business mix and efficiency savings.
Meanwhile export volumes grew by 5pc.
Stephen Glancey, C&C Group CEO, said that the group’s continuous focus on cost, efficiency initiatives and effective working capital management had delivered an improved operating margin and strong cash generation.
However Mr Glancey noted that "volatile" market conditions remain across the industry.
"We are pleased our GB businesses have made a solid start to the second half of the financial year. In Ireland, where the cider category remains highly competitive, trading has been marginally slower than expected," Mr Glancey said.
He went on to say that he was increasingly confident that the company’s brands, market positions, operational investments and now enhanced route-to-market infrastructure in GB would return the business to growth and deliver enhanced shareholder value over the medium term.
Last month C&C bought a chain of more than 800 UK pubs in a deal aimed at getting more of its drinks direct to consumers in England and Wales.
Irish Stock Exchange listed C&C has significant market share with Bulmers in Ireland and Tenants beer in Scotland in particular, but has so far failed to crack the massive English market.
In July C&C announced plans to build a €1.8m visitor centre in Clonmel as part of €5m tourism initiative by the company.