Drinks company C&C (CCR) took a big risk when it bought wholesaler Matthew Clark and Bibendum (MCB) in April this year. At the time of the acquisition, the business had been operating under severe financial and operational stress for some time and stock availability, customer service levels, supplier relations and financial controls were suffering. But it’s beginning to look like C&C has been successful in turning MCB around. The proportion of deliveries that were completed on time increased from 64 per cent to 95 per cent in the period, while stock availability improved to 96 per cent from 42 per cent previously. All overdue payments have been settled with HMCR and suppliers, and £146m has been recovered from customers.
The acquisition was behind the big jump in sales during the first half, but strip out this effect and the core business has made progress, too. Sales and volume growth were reported across all three core brands – Bulmers, Magners, and Tennent’s – aided in part by the warm summer weather and the FIFA World Cup. C&C is also branching away from its big names into the growing popularity of the craft beer market. Super premium craft beer now account for 7.5 per cent of branded sales, with organic volume growth up by nearly a quarter.
Bloomberg consensus forecasts estimate EPS of 27.8¢ during the year to February 2019, compared with 21.5¢ in FY2018.
| C&C GROUP (CCR) | ||||
| ORD PRICE: | 341¢ | MARKET VALUE: | €1.06bn | |
| TOUCH: | 343-346¢ | 12-MONTH HIGH: | 360¢ | LOW: 257¢ |
| DIVIDEND YIELD: | 4.3% | PE RATIO: | 15 | |
| NET ASSET VALUE: | 179¢* | NET DEBT: | 50% | |
| Half-year to 31 Aug | Turnover (€m) | Pre-tax profit (€m) | Earnings per share (¢) | Dividend per share (¢) |
| 2017 | 430 | 46.0 | 12.7 | 5.21 |
| 2018 | 981 | 52.8 | 14.6 | 5.33 |
| % change | +128 | +15 | +15 | +2 |
| Ex-div: | 1 Nov | |||
| Payment: | 14 Dec | |||
| *Includes intangible assets of €661m, or 212¢ a share | ||||
