Irn-Bru maker A.G. Barr saw its first-half sales increase 5.2 per cent to £221.3m during the 26 weeks to 27 July after a marketing campaign during the Euros helped offset the impact of cool and wet weather at the start of summer.
Both its Rubicon and Irn-Bru delivered volume and price gains, helping drive sales in its Soft Drinks division up 7 per cent to £194.6m. The group noted that Rubicon was the star performer, achieving double-digit growth ahead of the market through distribution gains and an increase in marketing investment.
However, sales in A.G. Barr’s Cocktail Solutions unit slumped 9.4 per cent to £21.1m after its Funkin cocktail brand was hit by ongoing weak consumer demand in the on-trade channel where late-night venues are particularly affected.
Meanwhile, the group’s Moma oats business, which was acquired in 2021, increased sales by 7.7 per cent to £5.6m after further distribution gains.
A.G. Barr’s adjusted pre-tax profits rose 8.5 per cent to £29.3m, with operating margin increasing from 12.5 per cent to 13.0 per cent as the business made progress with its margin rebuild programme. However, one-off costs of £4.4m relating to the closure of Barr Direct and the integration of the Boost brand, which A.G. Barr acquired in 2022, led to reported pre-tax profits falling 10.4 per cent to £24.9m.
Euan Sutherland, who took over the CEO role from Roger White in May, said his first few months with A.G. Barr had further cemented his view that it was “an excellent business with exciting, tangible and deliverable growth opportunities”.
He added, “The business has delivered both revenue and profit growth as well as good progress on our key strategic margin rebuild programme.
“We continue to invest in our supply chain to build the capacity to support our growth plans and manufacture more volume in-house. This will deliver tangible benefits, including enhanced margin and improved service resilience.
“We anticipate a strong H2 performance from our four core brands – Irn-Bru, Rubicon, Boost and Funkin – in particular, with current trading momentum underpinned by further marketing and innovation activities.
“Guidance on 2024-25 revenue and operating margin is unchanged. We remain confident of continued, sustainable growth over the long term, in line with our strategic ambitions.”
Brian McLister