Plenty of fizz in AG Barr

Reported sales growth outpaced that of the wider market, while volumes were 5 per cent higher - more than double the market growth rate. The operating margin also improved, reflecting good cost control, but this wasn't at the expense of brand investment, where marketing and promotional spend increased. Moreover, strong free cash flow allowed the group to slash net debt to £2.1m from £25.6m.

The carbonates division was the main growth engine, driven by AG Barr's core brands IRN-BRU, Barr and Rockstar. Indeed, sales rose 8 per cent, with volumes 5.8 per cent higher. IRN-BRU, a popular brand in Scotland, is taking off in England and Wales, too, where revenue rose 7.5 per cent in the year. Management sees huge potential to further develop brand awareness south of the border, with a particular focus on sugar-free varieties, which are growing in double-digits. Meanwhile, energy drink Rockstar saw sales soar 60 per cent, supported by new flavours and pack designs.

Exotic brands Rubicon and Ka experienced a more modest year, as competition in the sector heated up. Sales of Strathmore water jumped 9 per cent, helped by a number of new distribution partners such as restaurants and caterers.

However, there was surprise news regarding Barr's Orangina contract. That's due to expire at the end of 2014 and is unlikely to be renewed, although this won't materially affect financial performance. The second phase of the new Milton Keynes packaging facility is still being reviewed. The first phase, which doubled canning capacity, was delivered last year on time and on budget. Meanwhile, a focus for Barr in 2014 could be to push Rubicon harder into Europe and Scandinavia.

Broker Investec Securities expects adjusted pre-tax profit of £41.5m in 2015, giving EPS of 28p (from £38.1m and 27p in 2014).