Cider brands perform better than expected for C&C

IRISH drinks group C&C has given a rare upbeat trading outlook after better-than-expected results in its cider division.

The Dublin-headquartered group, whose core products are the Bulmers and Magners cider brands, said trading for the first four months of its financial year, from March, was ahead of expectations; with revenue up by 3% on a year-on-year basis.

Management said it now expects to report an operating profit “at the top end” of its guidance range of between €77 million and €82m for the full year to end-of-February 2010.

The revenue rise was mainly down to a 3% revenue increase in its cider division, as revenues for the four months were down by 12% year-on-year in the spirits and liqueurs division.

Despite this latter figure, management reiterated its stance that the spirits and liqueurs part of the business, which includes such brands as Tullamore Dew whiskey and Carolan’s Irish Cream, is not for sale and that it still holds a number of opportunities for growth.

Spirits and liqueurs receipts were pretty much par for the course for the spirits sub-sector of the drinks industry worldwide in the early part of this year.

“Following four months of encouraging trading in the cider division, the group now has a greater degree of visibility in, and confidence about, its plans for the current financial year,” its trading update stated.

“Overall cider volumes for the period are ahead of plan and in-line with the same period last year.”

The group also said its restructuring programme, including 120 job cuts at its Clonmel cider facility and a pay freeze, is on track to deliver the anticipated €5m in cost savings for the year.

Despite the better- than-anticipated statement, C&C’s share price dipped by 3.36%, or 8c, yesterday, to close at €2.30.

The group is to provide a further update at its annual general meeting on August 28.