Pepsi’s fizzy growth boosts Britvic results

A strong performance from its UK carbonates division, lead by “substantial” Pepsi share gain, has boosted revenues at soft drinks manufacturer Britvic for the all-important Christmas period, according to city analysts.

The firm, which makes and distributes Pepsi under licence in the UK, saw overall UK revenue grow 2.8% for the period ending December 25.

UK carbonates performed particularly strongly, according to experts, reporting a rise in revenue of 5.8%. This was largely driven by Pepsi, which substantially grew its market share of the take home cola market.

Damian McNeela, analyst at Panmure Gordon, said: “GB carbs reported good growth of 5.8%, principally driven by volume growth as consumers continue to switch out of higher priced stills, where revenues have declined. This is likely to have resulted in a negative mix effect for GB margins.

Lower price point

“Encouragingly, however, the Pepsi brand managed to achieve about £200M of share gain in the cola market as the company’s promotional activity, focusing on a lower price point over the Christmas period, delivered strong results.

Britvic’s first quarter results showed that overall revenues for the firm grew 2.5% to £295M for the period. This was also driven by a strong performance in France, which offset a weaker performance in Ireland.

The firm also announced deterioration in its UK and Ireland stills businesses, which McNeela attributed to a “weak consumer environment”.

Paul Moody, chief executive of Britvic, said: “Our GB, French and international business units have again delivered positive revenue growth and we continue to compete strongly and effectively in each of our markets.

“We expect the general economic and trading environments to remain challenging. But, despite this caution, we are confident in our ability to deliver another solid set of results for the year ahead, in line with our expectations.”