AG Barr On Course to Meet Expectations
UK soft drinks group AG Barr has maintained its strong momentum across the final quarter and expects revenue of about £252 million for the full year ending 26 January 2014, reflecting a year on year growth of 6.1%. This performance is particularly impressive given the tough prior year comparatives which saw near double digit growth in the second half.
The group’s core brands continue to respond positively to ongoing investment and development actions despite the increased intensity of price-driven competition in all of the major trade channels. Underlying margins have improved versus the prior year, however planned increases in levels of investment in marketing and promotion have capped further margin progress in the final quarter.
The operational performance of the business has been strong throughout the financial year, with excellent customer service delivered during periods of peak demand in the summer and across the Christmas trading period. This has been supported by the addition of the new site at Milton Keynes where commissioning of the plant and the logistics transfer programme are now complete, in line with the expected project timescales.
Over the period AG Barr’s free cashflow generation and balance sheet have remained strong, with the expected yearend net debt position better than previously anticipated.
AG Barr has delivered a consistent and robust performance in a marketplace characterised by volatile consumer demand and weather patterns, in addition to the ongoing economic challenges faced by consumers and a tough competitive environment. Looking forward, although it is unlikely that these challenges will materially change, AG Barr remain optimistic that the combination of a well invested operating platform, strong balance sheet, proven business model and capacity for growth leave it well positioned to continue to deliver long term shareholder value. AG Barr intends to announce its full year financial results on 25 March 2014.
