Bulmers owner C&C and Carlsberg swallow huge hits as virus continues to lash drinks industry

Cider and beer maker C&C has temporarily laid off 70% of its staff, implemented a 20%-40% pay cut and has scrapped its annual dividend.

Elsewhere, Danish brewing giant Carlsberg has warned of continuing sales falls as the fallout from the Covid-19 pandemic continues to lash the drinks industry.

C&C – which makes the twin cider brands Bulmers and Magners, as well as Five Lamps and Tennent’s beers – said it will slash its capital spending this year to between €7m and €10m, significantly down on last year.

Wider staff will take a 20% salary cut, while the group’s executive management and board will see their pay reduced by 30% and 40% respectively. The pay cuts will be for an initial three months and will be reviewed thereafter.

As it is availing of government cover in both Ireland and the UK, C&C said it has scrapped dividend plans, saying awarding a payout would not be appropriate nor prudent. It said it will reinstate its dividend policy “as and when appropriate”.

C&C has also pushed out publication of its annual results to the beginning of June and its AGM until July 23.

It also said that while it has reached the final stages of appointing a new CEO, the process will be delayed due to the current travel restrictions in Ireland and the UK.

Meanwhile, Carlsberg has said worse is still to come after a 7% decline in first quarter sales, as increased beer sales in supermarkets failed to balance the closure of bars and restaurants during the coronavirus lockdown.

Elsewhere, British pub group JD Wetherspoon – which is expanding in Ireland - plans to raise $175m (€161m) in a share placing as it tries to cope with the economic fallout from the coronavirus pandemic, which has forced all pubs to close.

- additional reporting Reuters