Wholesale woes put brakes on Britvic's Irish growth
Revenues at the Irish division of British soft drinks producer Britvic fell in the first half of its financial year.
Britvic Ireland - which owns the likes of Ballygowan water, MiWadi, and the Club range of carbonated drinks - posted revenues of £90.6m (€103m) for its first half; down by 0.9% on a year-on-year basis.
While the introduction of the Government's tax on sugar-sweetened drinks - introduced last year - played a minor role, a fall in the sale of third-party alcohol brands to pubs, via the Counterpoint wholesale division, was the chief reason for Britvic's Irish growth hitting the brakes.
While the majority of Britvic Ireland's product range is unaffected by the sugar tax, due to low or no sugar content, its Club range is, but sales across all brands balanced out during the period.
"Similar to Britain, following the introduction of the sugar sweetened drinks tax we initially saw strong market growth in low and no sugar variants and significant declines in regular volumes, though this has now stabilised," the group said.
On an overall group basis, Britvic - which sees Britain and France as its other core markets - reported a 1.9% annualised rise in first-half revenues to £769.2m, with post-tax profits increasing nearly 5% to £34.9m.
Group chief executive Simon Litherland said the UK soft drinks sugar tax has benefited the business, with more consumers migrating to its low sugar brands.
He also said the group has put in place contingency plans to deal with the possibility of a no-deal Brexit outcome. These include holding higher levels of stock. Britvic has incurred higher additional warehousing costs as a result, but Mr Litherland said the business is "well-placed" to deal with ongoing Brexit uncertainties.
