Profits Warning By AG Barr
Scottish soft drinks producer AG Barr has cautioned that profits in the first six months ended 28 July 2012 will be slightly below the prior year. The company’s performance has been adversely affected by extremely poor in the UK, with record levels of rainfall.
Despite the difficulties, AG Barr has continued to grow strongly ahead of the market and anticipates sales revenue of about £130 million for the first half, an increase of over 4.5% on the prior year. The company has maintained its strategy of investing in its brands and extending distribution.
However, margins in the period have been impacted by increases to cost of goods, increased brand investment and adverse changes to the sales mix at brand, pack and channel level. Although margins are expected to improve in the second half, it is unlikely to offset the margin shortfalls of the first half.
AG Barr is pushing ahead with its planned investment in the Crossley site, at Milton Keynes in England. It has now completed all of the development actions for Crossley and having obtained detailed planning approval has now committed to the full project. The full project budget of about.£41 million and a production commencement date for the site is scheduled for the third quarter of 2013.
