Britvic reveals profits hike as it raises prices to combat costs

Britvic reveals profits hike as it raises prices to combat costs
Soft drinks giant Britvic has seen half-year profits jump nearly 50% as it hiked prices to offset inflation, but cautioned over falling consumer spending amid the cost-of-living crisis.

The Robinsons squash and J2O maker reported pre-tax profits of £59.3 million for the six months to March 31, up from £39.8 million a year earlier.

Revenues jumped 18.5% to £719.3 million and the group said drinks bought for “immediate consumption” had now bounced back ahead of pre-pandemic levels, while trade overall across bars and restaurants recovered further.

The group said it increased prices at the start of the year amid efforts to offset soaring costs, but added that inflation was only partially mitigated in the first half.

Simon Litherland, chief executive of Britvic, said: “The current geo-political uncertainty is likely to result in continued cost inflation and pressure on consumer spending at least into 2023.

“I remain confident however that we will continue to successfully navigate the headwinds.”

The group added that “while soft drinks are not immune to changes in consumer spending, both the category and Britvic’s leading family favourite brands have historically shown themselves to be resilient” to wider economic turmoil.

The group also unveiled plans to increase shareholder returns, launching a £75 million share buyback programme and upping its dividend by 20% from 6.5p per share to 7.8p per share.

Britvic said it had seen strong trading continue into April, with double-digit revenue growth year-on-year.

The firm has been boosted by the lifting of restrictions on hospitality, which had hammered so-called out-of-home sales at the height of the pandemic.

In its British market, Britvic saw revenues leap 19.3% higher year-on-year, with out-of-home sales soaring 59% on the previous year, when Covid restrictions were in place, and continuing its recovery back to 2019 levels.

Sales of drinks through retailers continued to grow, up 4.4% year-on-year across Britain.