Fevertree (FEVR) chief executive Tim Warrillow admitted that the drinks manufacturer’s half-year results had “not been immune to the impact of the unseasonably poor weather in the UK” in the past quarter. A feverishly hot summer dominated by the men’s football world cup last year provided a tough comparator. Year-on-year sales growth slowed accordingly, with UK revenues, which amounted to 51 per cent of group turnover, up just 5 per cent. Fevertree shares slumped 12 per cent in response.
The overall picture is rosier, however. Fevertree continues to fare well in the UK, claiming to be the market leader in both on-trade (bars, restaurants) and off-trade (grocery, retail) mixers, with market share of 45 per cent (nearly twice that of Schweppes, according to Investec) and 39 per cent, respectively. The company continues to increase its overseas footholds, growing US sales by 24 per cent year on year on a constant currency basis, while rest of world sales jumped 49 per cent due to Australian and Canadian interest.
But gross margins edged down to 51.9 per cent from 53.2 per cent. Fevertree attributed this to a full six months of the UK sugar tax, a rise in underlying UK glass costs and increased storage costs linked to growing UK and US inventories.
House broker Numis forecasts full-year 2019 pre-tax profits and earnings per share of £82.1m and 56.9p respectively, rising to £91.1m and 64.3p in 2020.
| FEVERTREE (FEVR) | ||||
| ORD PRICE: | 2,024p | MARKET VALUE: | £ 2.35bn | |
| TOUCH: | 2,021-2,024p | 12-MONTH HIGH: | 4,120p | LOW: 1,985p |
| DIVIDEND YIELD: | 0.8% | PE RATIO: | 37 | |
| NET ASSET VALUE: | 173p* | NET CASH: | £104m | |
| Half-year to 30 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2018 | 104 | 32.7 | 22.9 | 4.22 |
| 2019 | 117 | 35.0 | 24.4 | 5.20 |
| % change | +13 | +7 | +6 | +23 |
| Ex-div: | 08 Aug | |||
| Payment: | 06 Sep | |||
| *Includes intangible assets of £41m, or 35p a share | ||||
