Britvic reports 'solid' start to the year as revenue tops €384m in three months
Warns on soft drinks levy
Revenue at drinks group Britvic increased by 3.3pc year-on-year to £337.2m (€384m) in the three months to 24 December.
Excluding the group’s Bela Ischia acquisition, organic revenue increased by 0.7pc, according to a trading updated from the group.
In Ireland, the maker of MiWadi saw its revenue increase by 16.5pc, as it benefited from the acquisition of East Coast in the second quarter of last year.
The acquisition has improved the groups presence in the on-trade channel.
Owned-brand revenue also increased in Ireland, due to positive price/mix, the group said.
In Britain the group also saw its revenue increase, as its soft drinks outperformed the market. Revenue from soft drinks increased 4.9pc in the UK, driven by the continued success of Pepsi MAX.
However Britvic’s revenue from stills declined by 6.6pc in the UK. The group also encountered a number of one-off costs in the UK with Palmer and Harvey entering administration.
The group used the trading update to warn on the potential impact of the soft drinks levy in Ireland and the UK, describing the levy as bringing “a level of uncertainty” to the group. However Britvic said it was “well placed” to deal with the levy.
"The introduction of a soft drinks industry levy in the UK and Ireland brings a level of uncertainty, but we are well placed to navigate this given the strength and breadth of our brand portfolio and exciting marketing and innovation plans," Simon Litherland, chief executive of Britvic, said.
"In addition, our continued focus on revenue and cost management and the delivery of the final phase of our business capability programme means we remain confident of making further progress in 2018," Mr Litherland said.
In international markets the group’s revenue declined by just over 8pc year-on-year, which the group said compared to a 19.8pc increase in the first quarter last year that followed the launch of the Fruit Shoot multipack in the US.
Britvic has made the decision to close its factory in Norwich next year, while it plans to create 80 roles at its Rugby site with the introduction of new lines and warehousing.
The company anticipates that it will incur approximately £35m-£40m of one-off costs in 2018, primarily in relation to its business capability programme and the closure of the Norwich factory.