Ireland’s C&C Group has made a good start to its new financial year, although it warned currency fluctuations following the UK’s EU referendum could impact its future results.
In Ireland, good weather in March and May gave the cider category an early boost with
Bulmers volumes up 9%.
After a challenging 2015, the C&C said the licensed on-trade in Scotland experienced a more stable start to 2016 with Tennent’s volumes rising by 5%. The group revealed Tennent’s began to recover some lost share in the Independent Free Trade in the first quarter.
Meanwhile, the recovery of C&C’s Magners brand in the UK continued with volumes jumping 24%. The group said that significant up-weighting of investment through its ‘Hold True’ above the line campaign and a recently completed repackaging of the brand, should ensure that the momentum continues into the second half of the year.
Looking ahead, C&C said the Euro Championships in France had been good for trade across Ireland in June and it anticipated a decent month for its brands.
However, the group remained cautious on its outlook for the year, given the volatility and uncertainty caused by the result of the EU referendum in the UK. With almost 50% of its profits denominated in Sterling and reported in Euros, C&C warned that it was exposed to the translation impact of a devalued Pound. At current levels, if sustained, the group said that currency movements have the potential to undo the earnings benefit from both its cost reduction activity and the steady progress made in trading year-to-date.