3rd Mar 2021 12:16
(Alliance News) - Nichols PLC on Wednesday reported sharply lower annual profit as the pandemic forced the soft drinks maker's Out of Home customers, such as pubs and restaurants, to close.
Amid continued uncertainty, Nichols kept guidance on hold.
The stock was down 4.4% at 1,075.00 pence in London at midday.
The Merseyside-based owner of the Vimto brand posted pretax profit of GBP6.5 million for 2020, a fraction of its GBP32.4 million profit in 2019.
This came as revenue fell 19% to GBP118.7 million from GBP147.0 million the prior year, and administrative expenses rose 17% to GBP35.1 million from GBP30.1 million.
Nichols explained that: "The arrival of the pandemic in our markets at the end of Q1 was a watershed moment for the year. The introduction of social distancing, the enforced closure of the group's Out of Home customers and the various lockdown measures introduced across the globe materially impacted our business."
The company withdrew its final 28.0 pence per share dividend for 2019 due to Covid-19 uncertainty. At the half-year, it agreed to rebalance the policy and consider 2019 and 2020 as a single period, paying 28.0p per share as an interim dividend for 2020.
It now has proposed an 8.8p per share final dividend under its new dividend policy, with dividend cover going forward to move to broadly two times adjusted basic earnings.
Executive Chair John Nichols said: "Whilst recognising the current and near-term impact of the pandemic on the soft drinks market, the board continues to believe that Nichols, underpinned by the strength of the Vimto brand, the group's diversified business model and the skill and commitment of our colleagues, remains well placed to deliver its long-term strategic ambitions. Given the continued near-term uncertainty, 2021 guidance remains withdrawn."
By Anna Farley; [email protected]
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