Nichols highlights challenging UK market

Soft drinks group Nichols cautioned on Wednesday that the UK soft drinks market will remain challenging this year, as it said full-year earnings are anticipated to be in line with market expectations.

In a statement ahead of its annual general meeting, the group said its trading performance for the first quarter of 2017 has been in line with management expectations. In the UK, the Vimto brand continues to outperform the market, with reported sales up 3.4% compared to the first quarter of last year. This compares favourably to the total soft drinks market growth of 1.2% in the same period.

In its international markets, sales to Africa have maintained the growth momentum from 2016 and as expected, the first quarter was a busy period for sales of Vimto concentrate to the Middle East ahead of Ramadan, which begins at the end of next month.

"We anticipate the UK soft drinks market will remain challenging throughout 2017 with the addition of currency related input cost inflation to an already price competitive environment.

"Against that backdrop, we are pleased with the group's trading performance for the first quarter and currently expect full year earnings to be in line with market expectations."

At 0930 BST, the shares were down 0.2% to 1,883p.