Nichols Q1 revenues ahead of last year

AIM-listed soft drinks group Nichols said on Wednesday that revenue in the first quarter of 2018 is ahead of the previous year.

In a very brief statement to be made at the company's annual general meeting, non-executive chairman John Nichols said revenue was ahead on a reported and like-for-like basis and compares favourably to total UK soft drinks market growth of 2.6%. LFL sales exclude the incremental sales from DJ Drink Solutions, which was acquired last June.

"As previously reported and as anticipated, the ongoing conflict in Yemen and the timing of the majority of shipments for Ramadan 2018 falling into Q4 2017 has impacted international sales in Q1 2018," he said.

The group maintained its previous guidance for 2018 and said it expects full-year earnings to be in line with market expectations.

Numis said that with guidance for FY 2018 maintained, it continues to forecast 1.5% adjusted pre-tax profit growth to £31m versus consensus of £31.2m and 3.7% sales growth to £137.7m versus consensus of £135.5m.

"Nichols' shares are down 5% year-to-date and currently trade on 21.3x price-to-earnings and 15.3x EV/EBITDA for CY 2018. We continue to believe that Nichols is a well-run business with a good track record for delivering growth. Growth is expected to be relatively low this year and on current multiples we think the shares are fairly valued."

At 1225 BST, the shares were up 2.9% to 1,510p.