Strong Interim Performance by AG Barr
AG Barr is continuing to outperform the UK soft drinks market by achieving strong growth in both sales and profit. The Scottish soft drinks group has reported a 5.4% increase in turnover to £135.7 million for the first six months ended 27 July 2014, with profit on ordinary activities before tax and exceptional items up by 14.6% to £19.0 million. Underlying profit before tax and exceptional items, allowing for £0.6 million of non-recurring income related to the early exit of contractual arrangements with Orangina, was £18.4 million, an increase of 11.0%
AG Barr produces and markets some of the UK’s leading brands, including IRN-BRU, Rubicon and Strathmore water. Volume in the period grew by 6.2%, with the Strathmore water brand contributing significantly to this strong volume performance. In value terms, carbonates grew by 4.5% and still drinks by 6.3%.
The total UK soft drinks market, as measured by Nielsen, grew by 0.8% in value terms, with a volume decline of 1.2% across the reporting period.
In line with its long term development strategy, AG BArr delivered a well balanced growth profile in the first half, with value growth of 6.5% in England and Wales, 4.5% in Scotland and 4.9% internationally.
All of its core brands have grown ahead of the market, with Strathmore water in double digit growth benefiting from increased distribution, innovation and further sector growth.
Innovation also played an important role in the performance, with the development and launch of a number of new products in the period – Rubicon Coconut Water, IRN-BRU ice cream and BARR XTRA Cola, all of which further strengthened the portfolio.
“We have delivered strong, balanced growth across our core brands in the year to date, with volume growth well ahead of the total market,” comments Roger White, chief executive of AG Barr. “Market conditions across the soft drinks category and general consumer environment are challenging, however we plan to maintain our increased levels of investment in our brands, people and assets across the rest of the year and we remain confident in the long term potential of the business.”
