Irn-Bru Maker A.G. Barr Says Profits To Fall 20% This Year
Irn-Bru maker A.G.Barr said on Tuesday it expected profits to fall 20% this year compared to last, citing disappointing spring and early summer weather and trading challenges in its Rockstar energy and Rubicon juice drinks.
The company, which cut prices last year to keep sales high after the UK imposed a sugar tax on soft drinks, said that as expected volumes this year had been hurt by a return to its traditional pricing strategy.
But it said trading in the first five months of the financial year had been below expectations and would weigh on its full-year results.
Stock market traders forecast shares in the company to fall 20% at opening on Tuesday.
Barr said it planned to launch three new Rockstar products at the end of the summer, and was improving the recipe for Rubicon, but would not see the benefit of these efforts until later in the second half of the financial year.
Revenue for the 26 weeks ending July 27 would be in the region of £123 million (€139.9 million), a fall of about 10% over the prior year, the company said.
"Despite our strong second half plan it is not expected that we will recover fully from the volume impact in the first five months of this year and the current trading we are experiencing," Barr said.
"As a result, we expect our profit performance for the full year to decline versus the prior year by up to 20%."