Shares in drinks group C&C tumbled on Thursday, after the drinks group said underlying earnings for its financial year would come in below target.
The owner of Bulmers cider in the Republic fell as much as 20 per cent in London, its biggest intraday drop in more than 15 years to 117 pence.
The company said revenues for its financial year would be in line with previous year as growth in its distribution business was offset by the sale of its non-core soft drinks business in Ireland and softer cider sales in Britain.
The Tennents owner expects to report underlying earnings in the range of €76 million to €78 million for the year ended February 28th 2025, below targets due to softer trading in January and February. However, it still came in ahead of the prior year’s earnings of €60 million.
The weaker than expected guidance is the latest problem for the struggling firm. Former chief executive Patrick McMahon left in June after the company was forced to restate three years of accounts, resulting in a net charge of €5 million.
C&C warned the hospitality sector was under further pressure from the macroeconomic environment and UK October Budget, which is contributing to ongoing uncertainty in consumer confidence.
The group also expected operating margins to be ahead of its previous financial year 2024, with positive progress in both its branded and distribution businesses.
“It is clear to me that C&C has a committed and capable team, alongside great brands and a passion for delivering for its customers,” said chief executive Roger White.
“However there is much work to be done to fully realise the potential across the group. Whilst the market backdrop remains challenging, we are continuing to support our customers, invest in the business and have some exciting plans to implement this year which I look forward to updating you on further in May.”
That will include the relaunch of Magners, with the brand now under C&C’s full management control in the UK market.
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A new share buyback is also on the cards, with C&C saying it planned to invest a further €15 million.
C&C said it remained confident in the longer-term and would further invest in its brands and systems. Earnings for the coming financial year are expected to be marginally ahead of 2025 as the company continues to invest in the business.
“I remain confident of the significant long-term opportunity within the business and I am fully focused on delivering increased shareholder value,” Mr White said.
