24th Feb 2005 07:00
C&C Group Plc24 February 2005 24 February 2005 PRE-CLOSE TRADING STATEMENT FOR THE YEAR ENDING 28 FEBRUARY 2005 Dublin, London, 24 February 2005: C&C Group plc ('C&C' or the 'Group'), aleading manufacturer, marketer and distributor of branded beverages and snacksin Ireland, today issued the following statement in advance of its close periodfor the year to 28 February 2005. The preliminary results for the year ending 28 February 2005 will be announcedon 10 May 2005. This will be the Group's first full year report since itsinitial public offering (IPO) and listings on the Irish Stock Exchange and theLondon Stock Exchange in May 2004. Financial Overview for the Year to 28 February 2005 • Against the background of a very challenging environment, in particular the introduction of the smoking ban in licensed premises and poor summer weather, underlying Group turnover (on a constant currency basis for continuing operations) for the full year is expected to have increased by a satisfactory 4%. This translates to an EBITA and EPS outcome that is in line with expectations. • The Group's cider brands (Bulmers and Magners) and Tullamore Dew have performed strongly and are the principal contributors to the expected underlying EBITA growth. • The currency impact of the weaker US/Canadian Dollar on Operating Profit will amount to €6.8m in the full year compared to 2003/04. Alcohol Division • Sales volumes of the division's principal brand, Bulmers, are expected to match last year compared with an overall long alcohol drinks (LAD) market decline in the region of 2%. • The ban on smoking in licensed premises came into effect at the end of March 2004 and is a significant factor in the decline in the on-trade LAD market. C&C estimates that the on-trade LAD market declined by approximately 6% in the year to 31 January 2005; that the rate of decline has been stable in the six months to January 2005 at 7-8%; and that off-trade growth has been in double digits throughout 2004. • The Group's international cider brand, Magners, has significantly exceeded expectations and is expected to achieve a full year volume growth in excess of 50%, with strong performances in Northern Ireland and Scotland International Spirits and Liqueurs • Overall shipments for International Spirits and Liqueurs are expected to increase by 7% for the full year. Depletions growth for Tullamore Dew are particularly strong while Carolans' performance was affected by weakness in North America over the Christmas quarter. Soft Drinks and Snacks • The combined carbonated soft drinks (CSD) and bottled water market declined by approximately 2% in the 11 months to 31 January 2005 - slightly in excess of the decline in the half year to August 2004. Other segments of the market such as energy, sport and cordial recorded good growth. The snack market was flat with the second half showing a small volume decline. • C&C's share of the CSD/bottled water market fell slightly in the period but it achieved good growth in the sports and cordial segments and performed in line with the snack market. Outlook The smoking ban, which is anticipated to have a one-off impact on the on-trade,is expected to be fully absorbed by mid-2005. The favourable prevailingeconomic conditions in Ireland are expected to continue throughout 2005 giving alift to consumer spending growth. C&C's principal plans for growth in 2005/06 are to improve Bulmers' existingshare of the Irish LAD market and to build upon Magners' success in Scotland byinvesting in its roll-out to selected other parts of the U.K. The costassociated with the roll-out is such that the EBITA for the Alcohol division isunlikely to show any significant growth in 2005/06. In other divisions, C&C will continue to increase the marketing investmentbehind Tullamore Dew to drive further growth. In the Soft Drinks & Snacksdivision, the Group will continue to exploit niche growth opportunities andincrease its focus on efficiency improvements. The impact of the US Dollar depreciation on operating profit is expected toamount to €2m in 2005/06 compared to 2004/05. Cash flow is forecast to remainstrong. Maurice Pratt, Group Chief Executive Officer, commented "The Group believes thatits plans for 2005/06 will establish the basis for solid medium-term growth andsupport a progressive dividend policy." Accounting Changes The company will adopt IFRS in 2005/06. The impact of this will be to reducereported EBITA in that year by approximately €3m. €2m of this reduction relatesto pensions and €1m relates to expensing share options granted in 2004.Reported earnings will in addition be affected by the elimination of a €30m P&Lcharge for goodwill amortisation. These changes have no impact on cash andaccordingly will not impact dividends. Pre-close Period Trading Statement - Analyst Conference Call Details Maurice Pratt, Group Chief Executive Officer and Brendan Dwan, Group FinanceDirector will host a conference call for analysts and investors at 2:00p.m.(local Irish time) today. Dial in details are available from K Capital Source on+353 1 631 5500 or c&[email protected] About C&C Group plc C&C is one of the largest manufacturers, marketers and distributors of brandedbeverages in Ireland and Northern Ireland and savoury snacks in Ireland. TheGroup owns several of Ireland's most recognised beverage and savoury snacksbrands, with leading market shares in various segments of the Irish beverage andsavoury snacks markets, including Bulmers cider, Ballygowan bottled water, Clubsoft drinks and Tayto crisps. Additionally, the Group distributes in Irelandseveral leading international brands owned by third parties, such as 7UP andPepsi soft drinks, and Volvic and Evian bottled water, and a wide-rangingportfolio of wines and spirits. In addition to its Irish operations, the Groupexports spirits and liqueurs to over 80 overseas markets and exports Magnerscider to the United Kingdom, the United States and Continental Europe. Investors and analysts Irish Media International Media Mark Kenny or Paddy Hughes or Edward OrlebarJonathan Neilan Mark Cahalane Finsbury GroupK Capital Source Drury Communications Tel: +353-1- 631 5500 Tel: +353 1 260 5000 Tel: +44 20 7251 3801 Email: Email: Email: c&[email protected] [email protected] [email protected] Or: [email protected] This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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