Irn Bru-Maker A.G. Barr Braces For 'Not Entirely Normal' Year After Profit Slumps
A.G. Barr, best known for Scottish fizzy drink Irn-Bru, has reported a 30.5% slump in full-year profit, as last year's coronavirus-led restrictions weakened sales in pubs and sapped commercial demand for its products.
The Cumbernauld, Scotland-based soft drinks maker said a resurgence in COVID-19 cases and another full lockdown in the UK hit hospitality sales and impulse purchases, but the company is confident about a turnaround.
'It is clear 2021 will not be an entirely normal year,' A.G. Barr said.
The company, which ended the year with £50 million (€58.7 million) in net cash, said sales of Irn-Bru fell 9.7%, with a decline in out-of-home revenue being partially offset by growth in the take-home category.
'Strong Financial Health'
"We closed the year in strong financial health, with our brands and business poised for growth on a like-for-like basis, and with the clear intention to recommence dividend payments in 2021," chief executive officer Roger White said.
A.G. Barr said that while sales of its cocktail brand Funkin saw an 11.5% slide, retail sales of ready-to-drink cocktails under the same brand showed strong growth with rising demand from consumers drinking at home.
The company said it took steps towards cost conservation across business units, but also continued investing in marketing.
Profit before tax fell to £26 million (€30.5 million) for the 12 months ended Jan 2021, compared with £37.4 million a year earlier. Sales in the reported period fell 11.2% to £227 million (€266.5 million).
In January of this year, the soft drinks maker had warned that the months ahead would be challenging due to the coronavirus-led restrictions imposed in December.