Demand for fizzy drinks helped Hertfordshire-based soft drinks firm Britvic boost first quarter global sales by 3.3 per cent.
The group, which is behind a string of well-known brands including Tango, Pepsi MAX and Robinsons juice, saw sales in the UK rise by 1 per cent in the quarter, largely due to a 4.9 per cent increase in revenue from carbonated drinks.
Soft drinks companies up and down the country are rushing to reduce sugar across their product ranges ahead of the introduction of the ‘sugar tax’ in April.
Tasty treat: Demand for fizzy drinks helped Hertfordshire-based soft drinks firm Britvic boost first quarter global sales by 3.3 per cent
The levy will have two thresholds. Manufacturers will have to pay 18p per litre on soft drinks with more than 5 grams of sugar per 100ml and 24p per litre on those with more than 8 grams per 100ml.
While Britvic performed well in the UK during the last quarter, internationally, revenues fell by 8.1 per cent, compared to a 19.8 per cent increase over the same period a year ago. In France, revenues fell by 5 per cent.
By contrast, in Brazil, revenues rocketed by 22.6 per cent and in Ireland they increased by 16.5 per cent. In total, the group’s quarterly revenue climbed to £337.2million.
The company said it had absorbed a number of one-off costs from Palmer and Harvey, one of its wholesalers that was placed in administration recently.
Britvic is ploughing ahead with the closure of its Norwich factory in 2019, claiming ‘every effort will be made to support affected employees to find new roles or alternative employment.’
Simon Litherland, Britvic’s chief executive, said: ‘We have delivered a solid start to the new financial year, with group revenue growing 3.3% ahead of a strong first quarter last year.
‘As we said at our preliminary results, the introduction of a soft drinks industry levy in the UK and Ireland brings a level of uncertainty, but we are well placed to navigate this given the strength and breadth of our brand portfolio and exciting marketing and innovation plans.
‘In addition, our continued focus on revenue and cost management and the delivery of the final phase of our business capability programme means we remain confident of making further progress in 2018.’
Britvic’s share price is down 2.55 per cent to 764p.
Global sales: In Brazil, Britvic’s revenues rocketed by 22.6 per cent and in Ireland they increased by 16.5 per cent
Tax: Soft drinks companies are gearing up for the introduction of the ‘sugar tax’ in April
Last month, it was reported that Britvic’s boss, Simon Litherland, was paid £2.1million in the last year, despite the fact his company’s annual profits had fallen by 9 per cent.
Mr Litherland received a 19 per cent pay boost after blaming the group’s profits slump on falling sales of Fruit Shoot and Robinsons juice.
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