Nichols sees FY profits ahead of current market expectations

Soft drinks maker Nichols said on Friday that full-year profits were now anticipated to come in ahead of current market expectations after year-to-date revenues increased year-on-year.

Nichols said group revenues for the nine months ended 30 September were ahead of internal expectations at £107.0m, up 17% year-on-year as its key Vimto brand continued to deliver "a strong performance" across all of its markets.

The AIM-listed group stated that although uncertainty remained regarding fourth-quarter trading as a result of the increased levels of new Covid-19 infections in the UK, in light of its strong year-to-date trading, Nichols now believes that adjusted pre-tax profits will be ahead of current market consensus at £21.0m-22.0m.

"Whilst the group's revenue momentum is expected to continue into 2022, the outlook for the next financial year is adversely impacted by inflationary pressures including logistics, labour and materials, therefore profit expectations for 2022 remain unchanged," said the company.

Nichols added that cash generation continued to be "very positive" in 2021 and despite "ongoing financial challenges" resulting from the Covid-19 pandemic, cash and cash equivalents at the end of the period were £55.6m, up from £45.4m at the same time a year earlier.

As of 0945 GMT, Nichols shares were up 6.67% at 1,200.0p.