Sales were flat in both senses for Vimto maker Nichols (NICL) in the first half: they failed to grow, and there was a further rebalancing from fizzy drinks to stills.
The UK arm is at least outperforming an industry beset by deflation. UK sales were up 2 per cent, against a market down 0.1 per cent, according to data provider Nielsen. Meanwhile, exports were 5.8 per cent lower, mainly because of delayed shipments to Yemen, where pro-government forces are battling Houthi rebel fighters. This was countered by stronger-than-expected sales at its main partner in the region, Aujan Coca-Cola.
The bottom line fared better than the top, with adjusted pre-tax profits up 9 per cent thanks to lower operating costs. The Vimto brand stood out in the period, with 8 per cent growth in its still drinks counteracting the 3 per cent decline in the carbonated range.
The group also announced the purchase of UK-based premium juice drink company Feel Good, to bolster its position in stills. It plans to develop the brand across its distribution network, supported by increased marketing.
Broker N+1 Singer expects pre-tax profits of £27.8m this year, giving EPS of 59.5p (from £25.7m and 55p in 2014).
| NICHOLS (NICL) | ||||
|---|---|---|---|---|
| ORD PRICE: | 1,336p | MARKET VALUE: | £494m | |
| TOUCH: | 1,336-1,357p | 12-MONTH HIGH: | 1,338p | LOW: 835p |
| DIVIDEND YIELD: | 1.7% | PE RATIO: | 23 | |
| NET ASSET VALUE: | 165p* | NET CASH: | £31.8m | |
| Half-year to June 30 | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2014 | 54.7 | 2.0 | 4.2 | 7.1 |
| 2015 | 54.7 | 10.9 | 23.7 | 8.0 |
| % change | +445 | +464 | +13 | |
Ex-div: 30 Jul Payment: 28 Aug *Includes intangible assets of £16.4m, or 44p a share | ||||
