Summer sun and Covid reopening boost shares in drink firms   

Drinks makers and sellers raised their financial targets, betting on people stocking their fridges for the summer and soaring demand from reopened bars and restaurants

Irn-Bru maker AG Barr forecast profit for the year ending January 2022 to exceed pre-crisis levels.

Three drinks makers and sellers raised their financial targets, betting on people stocking their fridges for the summer and soaring demand from bars and restaurants as they reopen after months of pandemic lockdowns.

Fevertree, which sells premium tonics and drink mixers, expects 2021 revenue to rise by as much as 21% compared to last year, while Irn-Bru maker AG Barr forecast profit for the year ending January 2022 to exceed pre-crisis levels.

Online wine retailer Virgin Wines, which was bought out from billionaire Richard Branson's Virgin Group, also upgraded its revenue and core earnings targets following strong demand over the past two months.

"We have seen nothing but encouraging signs over recent months that the customers we have acquired are staying loyal," its boss Jay Wright said.

Recouping lost business

Companies making and serving drinks are recouping some of their lost business from the past year when the Covid crisis shut down a major source of their income: the hospitality industry. That hit could not be fully offset by more people stocking up their bars at home with alcohol and mixers during lockdowns.

Virgin Wines UK shares climbed 4%, though AG Barr was little changed, while Fevertree slumped 6% after a warning that margins would narrow due to supply chain issues and higher input costs.

JP Morgan analysts said Fevertree's caution may make some investors wary of the 2022 outlook.

Meanwhile, shares in C&C rose 2% amid hopes for increased sales during the warm weather in Britain and Ireland.