TIDMCCR
C&C Group Plc
("C&C" or the "Group")
Period end trading update for the 12 months ended 28 February
2018
Dublin, London | 13 March, 2018: C&C Group plc, the
manufacturer, marketer and distributor of branded cider, beer, wine
and soft drinks, today issues its period end trading update for the
12 months to 28 February, 2018 ("FY18"). Preliminary results for
FY18 will be announced on 16 May, 2018.
Summary
-- Despite weather-related disruption, trading and cash generation was
broadly in line with management expectations
-- Group operating profit is anticipated to be around EUR86 million for the
full year, with Admiral Taverns contributing an additional
EUR1.1
million to Group earnings
-- Cash conversion is expected to be within our guidance range at c.60%
of EBITDA
-- Tennent's in Scotland and super-premium brands grew revenues strongly
-- Magners returned to volume growth with momentum building through the
first year of our cider distribution partnership with AB
InBev
-- Resilient trading in off-trade and on-trade packaged in Ireland, but
competitive pressures in draught remain intense
-- Currency translation of c. EUR3 million and one-off impacts relating to
the new AB InBev arrangements negatively impacted full year
profitability
Market Review
In Scotland, Tennent's grew share in the important IFT and
retail channels in the second half, outperforming the overall GB
beer market which declined -2%1. Net sales revenues for Tennent's
are expected to be +3% for FY18 (FY17: -4%). Our wholesale business
in Scotland is also performing strongly growing volumes +2% (FY17:
-4%), revenues and share in FY18.
Our expanded distribution agreement with AB InBev for our cider
portfolio in the UK gathered momentum in the second half. Magners
was +9% in the second half (H1: -6%) benefitting from the launch of
Magners Dark Fruit, increased participation in major retailers'
Christmas promotions and incremental on-trade and wholesale
distribution. Magners will post flat volumes for the full year FY18
(FY17: +13%) against a GB cider market that was also flat2.
In Ireland, the trading environment remains highly competitive,
both within long alcoholic drinks and from other categories.
Bulmers (incl. Outcider) grew volumes and share in the off-trade
and maintained share in the packaged on-trade segment. In an
overall cider category that declined -1%3, Bulmers brand volumes
were down c.-6% for FY18 (FY17: +3%) reflecting the loss of
on-trade draught distribution points. As highlighted in our first
half results, revenues and profitability in Ireland were also
negatively impacted by reduced volumes in our wholesale business
and the reversion of certain customers to direct supply from AB
InBev.
Our super-premium portfolio made further progress across all our
domestic markets in the second half. Volumes will exceed 100kHL in
FY18, representing c.4% of Group branded volumes. Organic volume
growth from brands such as Menabrea and Heverlee, increased +41%
for full year FY18 (FY17 +60%). In addition, we saw strong first
year contributions from our recently acquired craft brands 5Lamps
in Ireland and Orchard Pig in the UK.
In Export territories volume growth is expected to be +2% (FY17:
+4%) for FY18. Good growth in Magners and Tennent's in Asia Pacific
was off-set by slower growth in cider in Europe attributable to
increased parallel import activity and supply chain disruptions in
our nascent African business.
In the US, Magners and Wyders stabilised through the course of
FY18, while Woodchuck and our other national brands lost volume and
share, reflecting an overall cider category in high single-digit
decline. In February 2018, we announced that our US subsidiary
Vermont Hard Cider would resume full responsibility for the sales
and marketing of the Group's cider portfolio in the US.
Cash and balance sheet
Cash generation remains robust, with cash conversion for FY18
expected to be within our long term guidance range at c.60% of
EBITDA (FY17: 53%).
During the year we made a EUR42 million investment in the UK
on-trade through Admiral Taverns and invested a further EUR12
million on our craft brand portfolio. In addition, we returned
EUR73 million to shareholders through a combination of share
buy-back and dividends.
Outlook
The performance of our Scottish businesses and our growing
super-premium portfolio has been encouraging in FY18 and both are
well positioned to deliver further value growth in FY19. The
introduction of minimum unit pricing of alcohol in Scotland this
year may result in some short-term market disruption, but longer
term will bring value to the category. While competitive pressures
remain in Ireland, we expect performance to improve next year. In
the UK, our strengthened route-to-market platforms of Admiral
Taverns and AB InBev are now well-embedded. The outlook for the UK
high street and consumer spending remains challenging but our
brands and the predominantly wet-led, community pubs we serve are
proving resilient.
1. GB on and off-trade beer volumes (CGA and Nielsen) - 12 mth
MAT to 31 December(CGA)/January(Nielsen) 2017/182. GB on and
off-trade cider volumes (CGA and Nielsen) - 12 mth MAT to 31
December(CGA)/January(Nielsen) 2017/183. ROI on and off-trade cider
volumes (Nielsen Ireland databases) - 12mth MAT to 31 December
2017
-ENDS-
Contacts
C&C Group plcStephen Glancey, Chief ExecutiveJonathan
Solesbury, Chief Financial OfficerJoe Thompson, Investor
RelationsTel: + 44 7980 844 580
Investors, Analysts & Irish MediaMark Kenny/Jonathan
NeilanFTI ConsultingTel: +353 1 765 0886Email:
CandCGroup@fticonsulting.com
UK & International MediaTim RobertsonNovella
CommunicationsTel: +44 203 151 7008Email:
TimR@novella-comms.com
View source version on businesswire.com:
http://www.businesswire.com/news/home/20180313005386/en/
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(END) Dow Jones Newswires
March 13, 2018 03:00 ET (07:00 GMT)
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