AG Barr’s growth ahead of soft drinks market
Sales were up 5% to £136m for the 26 weeks ended 28 July 2018. That nudged the company ahead of the 4.5% growth of the total soft drinks market [source: IRI soft drinks market data from 28 January to 1 July 2018].
AG Barr singled out its Irn-Bru brand in particular for its continued positive growth, with regular Irn-Bru increasing its volume and value share of the total soft drinks market, alongside strong growth in its low-calorie variant Irn-Bru Xtra.
Volatile external landscape
Despite a volatile external landscape and the full impact of the Soft Drinks Industry Levy still unknown, the company was still confident that it would deliver full-year profit to its previous expectations.
Chief executive Roger White added: “Our growth across core brands is especially encouraging and our strong second-half brand and sales development plans give us confidence that we can deliver against our profit expectations.”
Commenting on the results, Shore Capital analysts Phil Carroll and Clive Black agreed with AG Barr’s outlook for the full year and were confident the company would deliver another year of progress.
‘Strong innovation pipeline’
“We believe Barr has an excellent portfolio of brands with a strong innovation pipeline, an increasingly efficient and flexible manufacturing capability, as well as net cash on its balance sheet,” said the analysts.
“Therefore, we are confident management can continue to build on its strong track record of shareholder value creation in the future. The collective traits of AG Barr leads us to characterise the business as a high-quality equity play in the UK consumer space, so thoroughly meriting the premium rating the shares carry.”
AG Barr is set to announce its interim results on 25 September 2018.
This week also saw high street baker Greggs post its half-year results for 2018, revealing profit and sales growth amid its continuing investment in its supply chain restructure.
