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AG Barr profits ‘ahead’ | Pets at Home trading robust


Roger White and Irn-Bru

Irn-Bru manufacturer AG Barr said the positive sales momentum reported in the first half of 2022/23 continued and preparation for the deposit return scheme in August is “well advanced”.

Full year revenue growth is expected to be c.17% on a reported basis and c.15% on a like-for-like basis. 

The prior financial year included an extra week’s trading, while revenue for the year ended 29 January 2023 was strengthened by an eight-week contribution from the Boost brand, which was acquired on 5 December 2022, and a full year of MOMA.

The company invested in an initial 61.8% equity stake in MOMA Foods in December 2021 and completed the 100% acquisition on 20 December 2022.

All four business units within the group – Barr Soft Drinks, Boost, Funkin and MOMA – contributed to overall strong revenue performance. 

“We are pleased to confirm that we anticipate delivering a full-year profit performance ahead of the prior year, and slightly ahead of current market expectations,” said the group in a trading update. “We anticipate further revenue growth across the group with a continuation of our strong brand momentum.

“This is despite a backdrop of continued high inflation and the planned introduction of a deposit return scheme (DRS) in Scotland in August 2023, both of which have the potential to impact consumer behaviour.”

“Our internal implementation planning for DRS is well advanced and we believe our strong brand portfolio and ongoing actions to mitigate inflation will support the delivery of our growth ambitions.”

Roger White, chief executive, said: “As we enter a new financial year we are well placed to continue to develop and grow through our clear and consistent value-driven strategy.”

John Moore, senior investment manager at RBC Brewin Dolphin, said: “Cost inflation continues to be a theme, but the business is mitigating its impact on margins through a range of self-help measures.

“The new brands are also supporting sales growth and seem to be bedding in well. With a strong cash position, further additions to AG Barr’s stable could be in the offing as smaller peers struggle in the current environment.”

Shares in the company closed 4.36% higher.

London’s leading indices suffered losses following the gloomy outlook for the UK economy by the International Monetary Fund.

The FTSE 100 closed down 13.17 points, or 0.17%, at 7771.7, dragged down by losses for basic resources and energy firms like Weir Group Anglo American and United Utilities Group.

There is also the US Fed’s interest rate decision on Wednesday and the Bank of England’s decision on Thursday.

Shares in Tesco dipped by 0.69% after it acquired the Paperchase brand and announced a restructuring of its management and counter service.


KPMG UK said it raised pay for all partners and staff and delivered double digit growth for the second consecutive year.

Full story here

Pets at Home

Consumer revenue at the pet food and accessories retailer was up there 8.8% year on year with growth underpinned by a record number of consumers and “pleasing” volume growth. Consumer revenues are up by more than 30% against pre-pandemic.

Robust trading momentum has continued into Q4, and with eight weeks of the year left to trade, it now expects FY23 group underlying PBT towards the upper end of the current consensus range of £126-136m, ahead of previous guidance of c£131m.

Lyssa McGowan, chief executive, said: “The quality of our growth remains strong as we continue to grow volumes and attract new consumers through offering compelling value and service, in what remains a challenging inflationary environment.”

Global markets

Stocks in London were expected to open lower, following data from the International Monetary Fund warning that UK economy will shrink this year, despite growth elsewhere.

After putting in a very strong start to 2023, markets lost a fair bit of ground yesterday as investors grew a little concerned about the sustainability of the current rally, said Deutsche Bank in its morning update.

“There were several factors driving that, but an important one was the stronger-than-expected Spanish inflation print for January, which added to fears that inflation could prove more persistent than feared, meaning that central banks would need to keep up their hawkish stance for some time yet.

“That led equities and bonds to sell off over the last 24 hours, with the S&P 500 (-1.30%) putting in its worst start to a week so far this year, and second worst day of the year.”

The NASDAQ shed 1.96% on the day (worst day since December 22), whilst the FANG+ index of megacap tech stocks saw an even larger decline of 3.41% (also the worst day since December 22). 

While megacap tech stocks led the declines, 80% of S&P 500 constituents lost ground yesterday with the worst single sector actually being energy (-2.29%) on lower oil prices, as Brent crude was down 2.03%.

Spanish inflation print for January came in significantly higher than expected. Next up is French inflation today with German consumer prices, slated for today, now being postponed to next week, seemingly due to technicalities over new base effects.

In China, the official manufacturing PMI swung back to expansion in January.

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