AG Barr draws £60m to shore up finances

AG Barr has drawn its full £60m of available credit and frozen new capital projects to strengthen its finances as the coronavirus crisis takes its toll on the UK's hospitality industry.

The maker of Irn-Bru and other soft drinks said it was ready to report annual results on 24 March but had delayed publication after the Financial Conduct Authority announced a moratorium.

AG Barr said trading was encouraging at the end of the financial year but that the Covid-19 crisis had created unprecedented uncertainty. Consumers are buying goods to take home but there are big challenges for the hospitality sector, which makes up about 10% of AG Barr's business.

The FTSE 250 company said its balance sheet was strong with £10.9m of net cash in the bank at the end of its financial year. But it has drawn on the full £60m of revolving credit facilities. As well as shelving new capital projects it is reviewing existing spending and cutting marketing and commercial activity.

"As we look forward now, into what is an uncertain and challenging time, we have already taken a number of steps to further protect our long-term financial stability," AG Barr said. "We will continue to monitor developments closely and respond as appropriate."

The company's shares fell 5.8% to 408p at 08:22 GMT.

AG Barr said it had not suffered any shortages but that it relied on raw materials and packaging that could not be stored for more than a few days. So far service levels for customers are strong and the company will carry on delivering while demand is there and government guidance allows.