27th Jul 2022 11:10
(Alliance News) - Nichols PLC on Wednesday said it is mindful of inflationary pressures as it reported an increase in both revenue and profit, with its Vimto beverage outperforming the market.
For the six months to 30 June, revenue increased 19% to GBP80.2 million from GBP67.4 million a year prior.
The Newton-le-Willows, England-based soft drinks company reported a 17% increase in pretax profit to GBP10.1 million from GBP8.6 million as its Vimto brand continued to outperform the broader squash market.
The company will pay an interim dividend of 12.4p per share, up 27% versus 9.8p the year before.
Nichols is facing inflationary pressures relating to ingredient and packaging costs and is "mindful" of the hit this will have on earnings, it said, and "swift" customer, supplier and operational mitigations are underway.
Citing Nielsen data, Nichols noted that overall UK soft drink market volumes were down 4.3% amid inflation pressure. Nichols said UK packaged volumes for the period were largely flat, outperforming the broader market, as a result of its Vimto brand.
The soft drinks company's expectations for the full-year remain unchanged. The board expects adjusted pretax profit for the year to be GBP25.5 million.
"The board remains mindful of the potential earnings impact of continued inflation into [the next financial year] and beyond. We have a long-term track record of growth, a proven, diversified strategy, and a quality range of brands. All of this is underpinned by a strong balance sheet. As a result, the board remains confident that the group is well positioned to deliver its long-term growth plans," said Non-Executive Chairman John Nichols.
Shares in Nichols were down 3.0% at 1,280.00 pence in London on Wednesday.
By Dominique Pretorius; [email protected]
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