(Alliance News) - Fevertree Drinks PLC on Tuesday increased its share buyback as it pointed to signs of life in its UK market and opportunities for further growth in the US.
The London-based manufacturer of premium drink mixers said pretax profit leapt by 60% to GBP35.5 million in 2024 from GBP22.2 million a year prior.
Revenue increased just 1.1% to GBP368.5 million from GBP364.4 million, or by 3% at constant currency, but the bottom line benefited from a 6.9% drop in cost of sales to GBP230.1 million from GBP247.4 million.
At constant currency UK sales fell 3%, US sales jumped 12%, Europe sales were flat and Rest of the World sales soared 22%.
The company said UK sales were impacted by low consumer sentiment, especially in On-Trade, as well as a declining gin category.
"However, the UK economy started to show signs of improvement towards the end of the year, reflected in a much stronger second half performance for the brand, giving us confidence of returning to growth as we go into 2025," it added.
Earnings per diluted share rose to 20.85 pence from 13.18p.
Co-Founder & Chief Executive Tim Warrillow said Fevertree performed well, despite the "subdued consumer environment".
"Across every key region, we are gaining market share," he noted, adding this was "particularly noticeable in our largest region, the US, where once again the brand grew strongly and well ahead of the market."
In January the firm announced a strategic partnership with Molson Coors in the US.
As a result, Fevertree expects 2025 will be a transition year for the US business.
The firm said it is comfortable with consensus expectations of low single digit group revenue growth and around 12% group adjusted earnings before interest, tax, depreciation and amortisation margin.
Fevertree said the deal is a "considerable milestone" for the US business.
"The brand was already in a fantastic position, and we now believe that we have entered a new transformational phase for the brand's development, to drive our core opportunity within the mixer category to the next level, as well as opening up new opportunities for growth."
Fevertree expects to deliver strong group revenue and Ebitda growth over the medium-term.
In 2024, the company reported adjusted Ebitda of GBP50.7 million up 66% from GBP30.5 million a year prior, with an adjusted Ebitda margin of 13.7% up from 8.4%.
Fevertree said it is extending the buyback programme by an additional GBP29 million, resulting in up to GBP100 million to be returned to shareholders over 2025.
The dividend was increased by 2.0% to 16.97p from 16.64p.
Shares in Fevertree rose 7.5% to 801.10 pence each in London on Tuesday.
By Jeremy Cutler, Alliance News reporter
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Fevertree (FEVR)
