Beer and cider brewer C&C Group (CCR) grew revenue during the first half, but only because of contributions from new acquisitions Gleesons and Vermont Hard Cider Company. Otherwise, sales and volumes actually fell amid tough competition and less consumer demand for cider. That said, there was some improvement in the second quarter and management still expects full-year earnings growth of between 10 per cent and 16 per cent, and operating profit of €125m (£107m) to €132m.
A 4.6 per cent decline in group volumes sent net revenue down almost 7 per cent to €252m at constant currency, although cost-cutting limited the drop in underlying operating profit, down 4.5 per cent at €65.1m. The Irish market improved, helped by an 18 per rise in Bulmers cider volumes in the second quarter, although UK cider volumes fell 14 per cent as Magners underperformed and other brands lost ground to fruit flavoured rivals. Maintaining brand investment and further spending on staff and marketing meant profit here slumped by 31 per cent. Tennents UK experienced sales and volumes declines, too. Overseas, distribution changes in the US disrupted trade for the Woodchuck and Magners cider brands, and weakness elsewhere left international profit, excluding Vermont Hard Cider, down 10 per cent at €3.8m.
Broker Goodbody expects full-year adjusted EPS of 30.3¢, rising to 33.8¢ in 2015 (from 27.7¢ in 2013).
| C&C (CCR) | ||||
|---|---|---|---|---|
| ORD PRICE: | 410¢ | MARKET VALUE: | €1.41bn | |
| TOUCH: | 410-411¢ | 12-MONTH HIGH: | 521¢ | LOW: 367¢ |
| DIVIDEND YIELD: | 2.2% | PE RATIO: | 18 | |
| NET ASSET VALUE: | 232¢* | NET DEBT: | 18% | |
| Half-year to 31 Aug | Turnover (€m) | Pre-tax profit (€m) | Earnings per share (¢) | Dividend per share (¢) |
|---|---|---|---|---|
| 2012 | 397 | 64.0 | 16.6 | 4.0 |
| 2013 | 486 | 50.5 | 12.5 | 4.3 |
| % change | +23 | -21 | -25 | +8 |
Ex-div: 6 Nov Payment: 23 Dec *Includes intangible assets of €718m, or 208¢ a share £1=€1.16 | ||||
