AG Barr sees FY profit 'slightly ahead' of market expectations

Irn Bru maker AG Barr said on Thursday that full-year profit was set to be "slightly ahead" of previous market expectations after a strong performance in the second half.

In an update for the year to 28 January, the company said it expects revenue to be up around 26% on the year at £400m, or 7.6% higher on a like-for-like basis, excluding the contribution from the Boost Drinks business bought in December 2022.

Meanwhile, adjusted pre-tax profit is expected to be around £49.5m, up 13.8% on the year and slightly ahead of previous market expectations.

Barr said that despite the wet summer weather in the third quarter, its "positive underlying brand momentum" ensured a strong performance in the second half.

In the soft drinks category, which includes Irn Bru, Rubicon and Boost, inflation in the wider market continued to drive value growth but impacted volumes in the sector, it said. "However, our brand building and pricing strategy delivered both value and volume growth, ensuring we continue to offer consumers great tasting and affordable brands," Barr said.

Meanwhile, Funkin Cocktails enjoyed a strong performance in the fourth quarter, particularly in the off trade. Barr said that while the on trade channel remains variable, with late night venues experiencing reduced footfall, reports of improved festive trading for a range of hospitality venues is encouraging.

In MOMA Foods, there was further double-digit sales growth, supported by new business wins, mainly in the speciality coffee channel.

Chief executive Roger White said: "All our teams across the group have worked hard to deliver an excellent overall performance. This has been supported by continued brand investment, strong execution of our sales plans and progress across our supply chain improvement programme. We have positive momentum behind our brands and business as we enter the new financial year.

"This strong trading performance, coupled with the benefits already being delivered by our margin rebuild programme, has ensured we close the year with a strong profit performance and confidence in the group's long-term growth strategy."