UK cold snap contributes to Britvic UK’s tough quarter

By Helen Glaberson

- Last updated on GMT

Related tags: Cent, United kingdom, Ireland

Britvic has blamed last year’s snow and ‘adverse weather conditions’ for the drop in sales in its UK drinks sector during the company’s last quarter.

Overall, the company posted a 0.8 per cent revenue growth in its 2010 Q4 results, against last year’s 15.4 per cent.

Britvic said that ‘continuing pressures’​ for its single serve still drinks portfolio were impacted further by the cold snap that challenged trading in the UK’s pubs and clubs.

This resulted in a 3.5 per cent drop in volume and a 0.7 per cent fall in sales, according to the beverage manufacturer.

‘Relative improvement’ for Irish segment

However, Britvic said there had been relative improvement in its Irish drinks segment, which has struggled in terms of revenue and profit over the past three years.

The Republic of Ireland (ROI) market grocery volumes and value were up by 2.8 per cent and 0.7​per cent.

The rate of decline in the ROI Pub & Club channel also slowed in the fourth quarter, with a 7 per cent fall in both volume and value.

“In line with our expectations, Britvic Ireland volumes declined by 9.9 per cent, although (annual percentage rate) ARP grew by 1.1 per cent as we lapped a period of intense Britvic promotional activity,” ​said the company.

In January, the company revealed plans to cut as many as 100 jobs in Ireland as the soft drinks maker comes up against an economy in freefall.

The job cuts were announced as part of a strategic review designed to adapt the business model in Ireland to declining revenues and margins.

The move followed Britvic’s decision last year to take a £104.2m write-down on intangible and property assets in Ireland for 2010.

In the financial year 2010 volumes fell 1.3 per cent having already dropped 10.7 per cent the year before.

The beverage manufacturer predicts that savings from future structural changes will strengthen Britvic Ireland's profitability in 2011. The company said that details on this new structure will be presented at the company’s investor seminar in March.

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