C&C Group 'Well Positioned' For Long-Term Value Creation
Following the integration of the Matthew Clark and Bibendum distribution businesses, C&C Group is now "well positioned for long-term value creation", a leading analyst has said.
Cathal Kenny of Davy was commenting following the publication of a trading update for the group, in which it said that EBIT for the period to 29 February is expected to be 'marginally ahead' of current market estimates.
'Good Finish To FY20'
"C&C’s period end trading update confirms a good finish to FY20 with EBIT expected to be ‘marginally’ ahead of consensus expectations (Davy F: €114.7m)," Kenny wrote in a briefing note.
"Cash generation, a key tenet of the model, was strong in the period with net debt/EBITDA expected to be below 2.0x (Davy F: 2.0x). As anticipated, MCB is delivering to plan."
In its statement, C&C Group said that its Matthew Clark and Bibendum businesses 'continue to perform well against key financial metrics and performance targets', while synergy benefits have also been realised.
It said that the process to appoint a new chief executive is under way, with global executive search firm Spencer Stuart assisting with this process.
It also said that it is assuming 'no material or prolonged impact' from the coronavirus outbreak, which it is monitoring closely.
Earlier this month, C&C said that it had acquired distribution rights for AB InBev's complete Budweiser Brewing Group portfolio on the island of Ireland, commencing 1 July.
This means that brands such as Stella Artois, Beck’s, Corona, Leffe and Hoegaarden will be distributed in Ireland by C&C Group, and bring an end to Budweiser's association with Diageo in Ireland.
Commenting on the move, analyst Clive Black of Shore Capital said that the distribution agreement could be an "opportunity to return Budweiser in Ireland to its former glory" in Ireland.
C&C Group announces its preliminary results for full-year 2020 on 13 May.
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