Saturday 25 November 2017

Britvic tumbles as input costs soar

Peter Flanagan

Peter Flanagan

SHARES in Britvic plummeted yesterday after the drinks manufacturer said there would be no improvement in operating profit this year after input costs increased much more than expected.

The stock slumped more than 11pc after the company said "unprecedented" inflation had heaped pressure on the company's margins.

Last month Britvic said it had commenced price negotiations with the aim of protecting margins on the assumption that Great Britain & Ireland's 2011 input-cost inflation would be 5pc to 6pc.

That assumption has been blown out of the water however, by the jump in commodity prices since then, forcing the company to revise its inflation estimate to between 9pc and 11pc.

As a result, Britvic said they do not now expect any operating-profit margin improvement in 2011, excluding the impact of the French business.

"Despite these headwinds, Britvic fully expects this year's operating profit performance to be materially ahead of the 53-week result reported for financial year 2010," the company said. Britvic was down 11.3pc in London at 370.5p.

Irish Independent

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