Conditions are challenging

Barr costs in line but revenue to fall

Irn-Bru commonwealthSoft drinks company AG Barr said it had managed to overcome challenging conditions in the market but revenue for the full year will be lower. 

The Irn-Bru maker said the soft drinks market in the UK has continued to be challenging and highly competitive but the company’s trading strategy, brand activities and execution have delivered a robust market performance in the period.

Business performance has continued to improve across the second half of the year and revenue for the 53 weeks ending 30 January 2016 is now expected to be around £257m.

On an ongoing basis, stripping out the effect of the 53rd week, revenue for the full year is forecast to decline approximately 1.5%.

“Across the year, we have tightly controlled our cost base to ensure that our margins remain in line with our expectations.

“Our operational investments in efficiency and flexibility have continued to make good progress and all of our current projects are set to be delivered on time and within budget. The implementation issues we encountered in the first half of the year, associated with our Business Process Re-design go-live, have been resolved.

“Free cash flow generation and our balance sheet remain strong, enabling us to continue to develop the group for the long term.

“Having dealt with the challenges of the first half and successfully managed the festive trading period we are on course to meet our expectations for the year.

“While trading conditions are expected to remain challenging, we are confident that the combination of our strong and flexible business model, our differentiated brands and our well invested asset base will allow us to deliver further long term business success.”

The company will announce its full year financial results on 29 March.

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