Even the UK's severe winter couldn't quench the UK's thirst for soft drinks, and Britvic's brands - which include J20 and Robinsons - are continuing to take share in a market that's climbing in both volume and value terms. "In what has been a very biting recession, the category and our brands have proved resilient", said chief executive Paul Moody.
With relatively little aggressive promotional activity, that translated into strong margin expansion and profit growth, despite continuing challenges in Ireland. Group operating margins rose 150 basis points to 8.1 per cent, driving a 28 per cent increase in underlying operating profits.
And with trading on track in its home market, the group is now eyeing overseas expansion, announcing plans to acquire France's leading independent soft drinks group, Fruite Entreprises. Britvic will pay €237m (£203m) for the business, which will be part funded by a near £100m placing. As well as boosting EPS, the deal will provide the group's first physical footprint in Continental Europe, which Mr Moody said would be "a platform we can extend from." After extensive research, Mr Moody believes there is scope to push Britvic's Fruit Shoots brand aggressively into Europe.
Broker RBS expects full-year pre-tax profits of £97.1m and EPS of 32.3p (2009: £86.5m/29.1p).
BRITVIC (BVIC) | ||||
|---|---|---|---|---|
| ORD PRICE: | 448p | MARKET VALUE: | £976m | |
| TOUCH: | 448-449p | 12-MONTH HIGH: | 498p | LOW: 253p |
| DIVIDEND YIELD: | 3.5% | PE RATIO: | 15 | |
| NET ASSET VALUE: | * | NET DEBT: | £442m | |
| Half-year to 11 Apr | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2009 | 483 | 7.2 | 2.30 | 4.10 |
| 2010 | 505 | 27.8 | 9.80 | 4.70 |
| % change | +5 | +286 | +326 | +15 |
Ex-div: 26 May Payment: 2 Jul *Negative shareholders funds | ||||
