In a brief trading update, soft drinks group Nichols has revealed that its total revenues over the 12 months to 31 December climbed 14% to £164.9m, after a 10% increase in the second half.
As a result, the group expects its adjusted pre-tax profits to be in line with market expectations despite inflationary pressures accelerating later in the year.
The company noted that its Vimto brand had continued “perform well” in 2022, with its brand value increasing by 3.4% in the UK, broadly in line with the performance of its UK packaged route to market.
In the International packaged route to market, the Vimto brand continued to see good progress, with revenue growth of 15% versus the prior year. The second-half performance was even better, up 48% after a positive performance in all regions.
Nichols noted that its Out of Home (OoH) route to market had continued to recover from the impact of the pandemic and had seen revenue growth of 43% year-on-year. Growth slowed in the second half to 5% as more normal trading conditions returned and cost of living pressures impacted consumer spending.
The group revealed that the outcome of its OoH Strategic Review would be announced with its preliminary results in March, with it having identified “significant opportunities” for net margin improvement.
Looking ahead, Nichols said: “The group has a proven, diversified, and international business model. However, it is not immune to the significant and accelerating inflationary pressures impacting the wider consumer and soft drinks markets. Whilst FY23 will be a challenging year as cost of living pressures impact consumer demand across all routes to market, the group will continue to seek to mitigate these pressures through both cost efficiency and revenue management.
“With a long-term track record of growth, a proven and diversified strategy, a quality range of brands, and a strong balance sheet, the board remains highly confident that the group is very well positioned to deliver its long-term growth plans.”
Separately, Nichols named Elizabeth McMeikan as its next Non-Executive Chair. She will take over the role at the company’s AGM on 26 April, replacing the long-serving John Nichols who announced last April that he planned to retire.
McMeikan has held several non-executive board roles at consumer-focused public and private companies following an executive career spent with Colgate Palmolive and Tesco.
John Nichols, who will remain on the company’s Board as a Non-Executive Director, commented: “Following a thorough search process, in Liz the Nominations Committee have identified an outstanding candidate to take over as the Group’s next Chair. She has significant experience in consumer-facing businesses and public company boards, which I am very confident will be of great value to the Group.”
McMeikan added: “Nichols plc is an outstanding business with a proud history and exciting future prospects. I am both delighted and honoured to be given this opportunity to take over as the Company’s next Chair. I look forward to joining the Company and working closely with my new colleagues to contribute to the Group’s continued, sustainable success.”
