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(Alliance News) - AG Barr PLC on Tuesday said its chief executive will retire within the next year, and that it delivered volume and revenue growth in its first half year with "strong brand momentum".
The Cumbernauld, Scotland-based drinks manufacturer - whose soft drink brands include Irn-Bru, Rubicon and Tizer - said it expects revenue for the first half of 2023 to be up by about 33% to GBP210 million, from GBP157.9 million the year before.
AG Barr said it delivered both revenue and volume growth during the period and that this reflected the impact of higher prices, "underlying brand momentum," and "particularly good" weather. Margins "remained under pressure", but were nonetheless in line with expectations.
In particular, AG Barr reported a "strong trading performance" across its Soft Drinks divisions, due to "effective sales execution" and "successful" marketing to consumers as well as volume growth, pricing and mix.
The Funkin Cocktails division saw increased investment in consumer marketing, "continued exciting innovation" and distribution gains likewise driving revenue growth.
"While cocktail consumption in the on-trade has slowed following last year's post-Covid high, Funkin has maintained its position as the UK's number one cocktail brand," AG Barr remarked.
Additionally, AG Barr said consumer marketing and brand investment drove "significant" growth for Moma Foods, with its oat milk product performing particularly well.
"In March we communicated that 2023/24 would be a year of investment across the business, supporting the group's long-term revenue and profit growth ambitions. I am pleased to report we have had a strong first half, despite ongoing macro cost challenges," commented Chief Executive Roger White.
Looking ahead, AG Barr expects its full-year profit to "marginally" surpass analysts' expectations, despite ongoing cost inflation being likely to affect its operating margin.
White said: "Our medium-term plan to rebuild the group's operating profit margin is progressing well across a range of activities, including supply chain optimisation, cost management and portfolio development. We have strong brand plans in place...to sustain our growth momentum and we remain confident in the Group's long-term growth strategy."
Also on Tuesday, AG Barr announced that White will step down as CEO and retire from the company within the next 12 months. It said it will "immediately" start a formal search for his successor to ensure a smooth transition.
White joined AG Barr in 2002 as managing director, and was promoted to CEO in 2004. Chair Mark Allen said he "supported [its] transformation...from a regional soft drinks business into a highly successful multi beverage, branded company that has delivered significant value", and which is "strategically well placed to continue to deliver for the long term".
AG Barr shares were up 2.2% at 482.00 pence on Tuesday morning in London.
By Emma Curzon, Alliance News reporter
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