FDBusiness.com

AG Barr, which produces and markets some of the UK’s leading drink brands, including Irn-Bru, Rubicon, Strathmore and Funkin, increased revenue by 8.8% to £136.6 million and profit on ordinary activities before tax and exceptional items by 2.9% to £17.5 million for the six months ended 29 July 2017. The revenue growth was significantly higher than that of the total soft drinks market which grew value by 4.2% in the 26 weeks to 30 July 2017.

However, increased brand investment coupled with sector cost pressures related to the ongoing weakness of sterling, led to a moderate reduction in operating margins – from 13.9% in 2016 to 13.2% – during the period. AG Barr has managed to lessen the margin impact through a combination of the business re-organisation, completed early in 2017, and price increases.

Roger White, chief executive of AG Barr, comments: “The strong sales momentum of the second half of last year has continued and has combined with significant progress from our innovation to deliver strong sales growth and market share gains in the period. While we maintain tight cost control across the business, we have increased investment in the support of our brands and innovation launches and expect to continue this across the full year. Our reformulation activities remain on track as we move into the final implementation stages of this initiative in what will be a busy second half.”

AG Barr is on track for at least 90% of company owned brands to contain less than 5g of total sugars per 100ml by the end of the financial year (January 2018). The group’s new PET production line at it Milton Keynes facility is now operational, with the project delivered on time and budget.