19th Nov 2020 13:33
(Alliance News) - Soft drinks maker Nichols PLC on Thursday reported strong growth by its Vimto brand in the UK despite a weaker Out of Home market due to Covid 19 lockdowns in the first nine months of the year.
As a result, Merseyside-based Nichols said total revenue in the period ended September 30 decreased by 17% from a year before to GBP91.7 million.
Nichols said cash generation has remained strong in 2020 despite the challenges posed by the ongoing pandemic, with its cash and cash equivalents at the end of the period reaching GBP45.4 million compared to GBP37.2 million in 2019.
The Vimto brand has continued to outperform the wider UK soft drinks market, Nichols said, with growth of 5.8% in value terms in the year to date, versus 1.9% for the wider UK soft drinks market.
Nichols currently expects adjusted pretax profit for 2020 to be between GBP11 million and GBP13 million, compared to reported pretax profit of GBP32.4 million in 2019.
Nichols said it has focused on controlling overheads and operational costs while ensuring it is able to "build back better" after the pandemic. Its management has focused on reducing discretionary spend and realigning marketing investment for 2021, which led to an announcement to employees on Wednesday that a number of roles would be made redundant by the first quarter of 2021.
Non-Executive Chair John Nichols, said: "As part of our ongoing focus on ensuring the group has the right structures in place to deliver its long-term strategy, the group has taken the difficult decision to propose, subject to consultation, that a number of roles are removed from our structure."
He added: "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 and the group's diversified business model, remains well placed to deliver its long-term strategic ambitions."
Shares in Nichols were down 5.8% at 1,130.00 pence in London on Thursday.
By Zoe Wickens; [email protected]
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