Beverage maker AG Barr (BAG) has won a contract to exclusively sell, market and distribute Snapple soft drinks across the UK and Europe. The 10-year deal with US-based Snapple Beverage Corp will see the drink introduced to UK consumers for the first time. Barr chief executive Roger White said he was excited about the partnership, which will kick off in January.
The news came as AG Barr announced a 5 per cent rise in like-for-like sales in the first half, which drove an 11 per cent increase in underlying pre-tax profit to £18.4m. All of Barr's core brands grew ahead of the market, but Strathmore Water was the standout player, serving up 14 per cent growth. Encouragingly, all the growth came from volume gains rather than price increases: group volumes were up 6 per cent. In value terms, the carbonates category grew sales by 5 per cent and stills reported a 6 per cent rise. By contrast, sales in the wider market were up only 1 per cent, as volumes dipped 1.2 per cent.
Barr's new high-tech facility at Milton Keynes is yielding good results, too. It is improving group efficiency by bringing production much closer to customers in England - an area of growth for Barr.
Broker Investec Securities expects pre-tax profit of £41.5m for the full year, giving EPS of 28p, up from £38.1m and 27p last year.
| AG BARR (BAG) | ||||
|---|---|---|---|---|
| ORD PRICE: | 634p | MARKET VALUE: | £741m | |
| TOUCH: | 632-636p | 12-MONTH HIGH: | 672p | LOW: 502p |
| DIVIDEND YIELD: | 1.8% | PE RATIO: | 24 | |
| NET ASSET VALUE: | 134p* | NET DEBT: | 2% | |
| Half-year to 27 Jul | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2013 | 128.7 | 13.2 | 8.7 | 2.825 |
| 2014 | 135.7 | 16.5 | 11.1 | 3.11 |
| % change | +5 | +24 | +27 | +10 |
Ex-div: 1 Oct Payment: 17 Oct *Includes intangible assets of £76.3m, or 65p a share | ||||
