12th Sep 2024 09:56
(Alliance News) - Shares in Fevertree Drinks PLC on Thursday fell amid lowered sales guidance as poor weather contributed to below par first-half results.
In the six months ending June, the London-based maker of carbonated mixers said revenue fell 1.5% to GBP172.9 million from GBP175.6 million a year prior.
Pretax profit jumped to GBP13.2 million from GBP1.4 million and adjusted earnings before interest, tax, depreciation and amortisation rose to GBP18.2 million from GBP10.2 million.
The dividend was increased by 1.9% to 5.85 pence per share from 5.74p.
Fevertree said the results reflected a "subdued consumer backdrop and poor weather in the second quarter across the UK and Europe."
Goldman Sachs said sales growth was "well below" Visible Alpha consensus for growth of 3.6% while revenue was around 3% below market hopes.
In response, shares in the London-based maker of carbonated mixers, fell 10% to 772.50 pence each in London on Thursday morning.
After a soggy end to the first half, the company reported growth of 13% for the FeverTree brand in July and August.
"Good progress on key operational initiatives and softening inflationary headwinds underpin our confidence in further margin recovery in the second half of the year. The group remains on-track to deliver around 600 basis points of gross margin improvement for the full year, as well as ongoing improvement over the medium term."
The firm expects to deliver brand growth for the second half of 7% to 10%, resulting in annual revenue growth of 4% to 5%.
Goldman Sachs noted the revenue forecast compared to 10% before and consensus of 6.8%.
Chief Executive Tim Warrillow said the firm has performed well against a tough market backdrop.
"We continued to deliver double-digit revenue growth in the US at constant currency, as well as a strong performance in our ROW region. The first half performance in the UK and Europe was impacted by unseasonable weather at the start of summer alongside distributor order phasing in Europe, but we have seen a strong improvement in these regions as the summer belatedly arrived."
By Jeremy Cutler, Alliance News reporter
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