AG Barr remains confident
Barr takes £10m hospitality hit on Strathmore as jobs cut
Strathmore took a big hit from lockdown
Soft drinks firm AG Barr said it had laid off workers in Forfar and taken a £10m impairment charge on its Strathmore brand and assets which have been significantly hit by the challenges in the hospitality sector.
Across the first six months of the financial year, group sales to hospitality customers fell by c.65%, peaking at c.95% during the full lockdown period.
Current forecasts assume the UK will not enter into a further significant period of lockdown and indicate that full year revenue performance for the year ending January 2021 will be in the region of 12-15% below the prior year.
The company is forecasting a “modest reduction” in operating profit margin and says it expects to resume dividend payments in 2021.
The Strathmore brand in particular has been impacted by the lockdown given the significance of its sales in the hospitality sector.