Irn-Bru maker AG Barr said today its sales had fallen flat amid a competitive and volatile market.
The Cumbernauld-based firm posted a 1.1% fall in sales for the 15 weeks to May 9 as it also came up against tough comparisons from a year earlier, when it sponsored the Glasgow Commonwealth Games.
But the business, which also makes Tizer and Rubicon, said sales in the wider soft drinks market lifted 0.7% in the same period.
It said its recent trading represented a return to a more normal sales period, although the group added it planned a strong summer branding programme and expected to see sales grow in the second half of the year.
The firm said it expected to meet its full-year targets, but warned although the UK economy was more positive, the retail market continued to experience challenging conditions. Shares slipped 2%.
N+1 Singer analyst Sahill Shan said the most disappointing aspect of the update was the “uncharacteristic underperformance” against the wider soft drinks market.
Mr Shan added: “We expect trading conditions to remain challenging for the remainder of the year as supermarket and retail price deflation is unlikely to abate in the near-term.”
N+1 Singer expects full-year profits at AG Barr to lift 5.3% to £44.1 million.
Barr said its current sales figures exclude its offloaded Orangina and Findlays water coolers drinks brands, but did include a £3 million revenue contribution from its recently acquired Funkin cocktail drinks business.
In February, Irn Bru bought the London-based cocktail business Funkin for up to £21 million. It said the purchase took the group into the cocktail mixer market for the first time, which has shown strong growth in recent years.
The Scottish firm added it would continue to extend its reach into the south of England by developing its new factory in Milton Keynes, opened in 2013.
It said it would extend the site’s warehousing capacity, and will buy more land next to the plant at a cost of £11 million.