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Fevertree signs US deal

The beverage company is looking to expand in the US, with a dedicated management team and a new distribution deal that spans 29 states
July 24, 2018

Fevertree (FEVR) has the US firmly in its sights. The group has signed a deal with Southern Glazer's Wine and Spirits – the largest North American distributor of its kind –to be the company’s exclusive distribution partner in bars and restaurants across 29 states. Chief executive Tim Warrillow says this will allow for national campaigns across the US, which should improve Fevertree's brand awareness across the pond. But it already appears to be proving popular with Americans: US sales rose 15 per cent to £15.1m during the first half alone. 

IC TIP: Hold at 3897p

Rest assured, US expansion hasn't come at the expense of the domestic business. Fevertree is still the number one mixer brand sold in the UK off-trade market, helping to take UK sales up 73 per cent to £58m. The “Refreshingly Light” range of lower-sugar mixers have also been rolled out ahead of the incoming sugar tax.  

Analysts at Investec expect pre-tax profits of £67.8m in 2018, giving EPS of 46.8p, compared with £57.1m and 39.7p in 2017.

FEVERTREE (FEVR)   
ORD PRICE:3,897pMARKET VALUE:£4.5bn
TOUCH:3,893-3,900p12-MONTH HIGH:3,987pLOW: 1,737p
DIVIDEND YIELD:0.3%PE RATIO:86
NET ASSET VALUE:129p*NET CASH:£56.4m
Half-year to 30 JunTurnover (£m)Pre-tax profit (£m)Earnings per share (p)Dividend per share (p)
201771.924.116.93.01
201810432.722.94.22
% change+45+36+36+40
Ex-div:9 Aug   
Payment:7 Sep   
*Includes intangible assets of £42.1m, or 36p a share