Magners key to growth at C&C, say analysts

SALES of Magners cider, rather than overseas acquisitions, could be the key to Irish drinks group C&C substantially increasing international presence, according to analysts.

C&C — whose chief assets are twin cider brands Bulmers and Magners — is due to publish full-year financial results next week, when earnings of €104m are expected to be reported. A driving force behind the group’s good trading has been sales of Magners, and not just in its home market Britain.

“We estimate Magners International grew volumes by 37% for the year to the end of February. A double-digit growth rate looks achievable in the medium term, given a number of favourable factors. This division could significantly accelerate the group’s underlying medium-term growth prospects,” said Barry Gallagher of Davy Stockbrokers in a pre-results research note &yesterday.

Davy — which is also C&C’s chief broker — is also upbeat about next week’s results, adding trading in its current year-to-date looks to have begun well.

Magners International excludes Britain, but takes into consideration sales in the US and Australia.

The three big international drinks markets of the US, South Africa and Australia are seeing mid-teen growth percentages in cider sales and the drink is classed as the fastest-growing portion of the long alcoholic drinks (LAD) category; although growth is being driven by domestic brands in the main.