22nd Jul 2020 12:02
(Alliance News) - Nichols PLC on Wednesday said its chief executive officer will step down at the end of 2020, replaced by its chief operating officer, as the soft drinks maker reported a steep drop in half-year revenue.
Despite the Covid-19-related hit to sales, Nichols moved to restore dividend payments.
Marnie Millard will resign as CEO on December 31, with COO Andrew Milne promoted to Millard's place. Milne has been with the Merseyside-based company for seven years.
The Vimto brand owner said revenue took a hammering in the first half with the out-of-home market effectively closed in the second quarter.
Revenue in the six months to June 30 was down 17% to GBP59.2 million compared to last year's GBP71.6 million
Nichols said the Covid-19 lockdown severely hurt out-of-home sales, with both carbonate and still product sales dropping.
Half-year pretax profit was down 77% to GBP2.9 million from GBP13.3 million a year before.
In the UK, revenue decreased by 20% to GBP45.9 million compared to last year's GBP57.1 million
Despite the knock to results, Nichols more than doubled its interim dividend to 28.0 pence from 12.4 pence last year. Back in March, Nichols had withdrawn in final dividend for 2019, due to the uncertainty caused by the virus pandemic. It said Wednesday it now will consider 2019 and 2020 as a single period for the purposes of dividend payments. With a strong cash and after-tax profit performance in the first half, it has decided to raise its 2020 interim dividend "to reinstate the value of the final proposed dividend from 2019 of 28.0p as the interim dividend for 2020".
Non-Executive Chair John Nichols admitted that the immediate future remains cloudy due to Covid-19. "Uncertainty remains concerning the outlook for the second half, particularly in terms of the degree to which the out-of-home sector will recover and the development of the pandemic in Africa. As a result, the board is still not in a position to provide financial guidance for the rest of this year and beyond."
Separately, James Nichols, commercial controller of Vimto Out of Home Ltd, has been appointed as a non-executive director, effective immediately.
James Nichols is appointed as a representative of the Nichols family as part of a relationship agreement entered into between the company and the Nichols family on Wednesday.
The relationship agreement will formalise board representation for the Nichols family, while also ensuring that the company is capable of carrying on its business independently, it said.
John Nichols, James Nichols' father and company chair, has also been nominated as a family representative director, in accordance with the relationship agreement.
Nichols shares were up 1.3% at 1,200.00 pence each on Wednesday in London.
By Greg Roxburgh; [email protected]
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