C&C Group profits forecast to be in line with market expectations

19-Jan-2024 - Last updated on 19-Jan-2024 at 12:07 GMT

Market conditions challenging: C&C Group will announce its FY24 full-year results in May

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C&C Group, which owns Matthew Clark, Bibendum Wine and brands Tennent’s, Magners and Bulmers Ireland said it expects full-year operating profit for its 2024 financial year (FY24) to be in line with current market expectations.

Trading over the key Christmas period was resilient despite some adverse weather in Great Britain (GB), the group said in a trading update.

In the 10-month period to December 2023 the group’s branded net revenue in its unaudited financials is up 6% with distribution net revenue down 3%.

C&C said service levels, defined as On-Time-In-Full (OTIF), were industry-leading in the GB distribution business over the Christmas trading period, reflecting the group’s commitment to deliver market-leading customer service through GB’s pre-eminent distribution platform.

Medium-term priorities

C&C Group said: “While current market conditions remain challenging, mitigating inflationary impacts, improved operating efficiency, business simplification and gaining customers continue to be the group’s operating priorities in the medium term.

“An update will be provided as part of our full-year results announcement later this year.”

With increasing confidence in the medium-term outlook for the business and its strong cash generation capabilities, the board reaffirms its intention to distribute up to €150m (£129m) to shareholders over the next three fiscal years while maintaining the group’s leverage target of 1.5x to 2.0x.

C&C will issue full-year FY24 results in May 2024.

Net revenue boost in FY23

In the company’s FY23 results, reported in May 2023, C&C Group announced an 18.4% boost to net revenue for the 12 months ended 28 February 2023.

Other financials reported included net revenue rose to €1,689.0m, driven by volume growth of 4.2% and price-mix growth of 14.2%., from €1,427.1m in FY22. An operating profit increase of 75.6% to €84.1m (FY22: €47.9m) delivered an operating profit margin of 5.0% (FY22: 3.4%).

CEO Patrick McMahon said at the time: “Set against a challenging backdrop in FY23, C&C delivered an improved performance against all financial measures.

“Increased balance sheet strength and inherently strong, free cash flow characteristics have enabled C&C to return capital to shareholders through the reinstatement of dividends.”