24th Jul 2014 10:56
LONDON (Alliance News) - Soft drinks group Nichols PLC Thursday expressed confidence in meeting its full-year expectations and raised its interim dividend, despite seeing pretax profit hit by litigation costs in the half year to end-June.
Nichols proposed an interim dividend of 7.1 pence, up from 6.32 pence in the previous year.
The company posted a pretax profit of GBP2.0 million, down from GBP9.0 million, despite seeing revenue rise to GBP56.6 million from GBP55.2 million. The revenue increase was offset by a GBP8.0 million exceptional costs relating to a litigation claim from Gul Bottlers Ltd.
In July the company said it has been ordered to pay GBP8.0 million to Gul over a claim relating to Gul's rights to manufacture and distribute Vimto cordial in Pakistan.
UK sales were up 8% driven by growth in its carbonate category. Sales in its still category rose 3%. In the UK, Nichols said it expects its performance for the remainder of the year to maintain the positive trend it has seen in the first half.
International sales fell 12%, in line with expectations, mainly due to the shift in the timing of shipments of Vimto to the Middle East. As a result of this shift, the company said it expects its international revenues in the second half to be ahead of the previous year.
Nichols said that international revenues also were hit by the appreciation of sterling against the dollar and euro, accounting for about 3 percentage points of the 12% decline.
Shares in Nichols were trading up 1.8% at 951.85 pence Thursday morning.
By Hana Stewart-Smith; [email protected]; @HanaSSAllNews
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