The siren call of fmcg is hard to resist, especially when you’ve been under its spell for more than two decades.
While it seemingly came out of nowhere, today’s news that former AG Barr CEO and soft drinks veteran Roger White is postponing his much-publicised retirement to take the helm at Irish drinks giant C&C Group should shock absolutely nobody.
Since leaving AG Barr in the spring, White has shown no signs of slowing down. He’s a non-executive director at bakery giant Warburtons and chair of Beatson Cancer Charity. At 59, he’s still got plenty of gas in the tank and – as last month’s return of Allan Leighton at Asda demonstrates – the value of a steady, experienced hand in times of turbulence cannot be understated.
White’s 22-year AG Barr legacy
During his 22-year stint at the helm of AG Barr – one of the longest at any UK public company – White transformed the business from a regional Scottish supplier to a national soft drinks player via a slew of acquisitions, including Rubicon, Funkin, Boost and Moma Foods.
Annual revenues at AG Barr now exceed £400m – a figure that would have been higher still had White not been thwarted in his attempts to broker a merger with Britvic back in 2012.
White’s “decades of experience in the drinks industry will be invaluable,” says Dan Coatsworth, investment analyst at AJ Bell. He points to the significance of AG Barr’s diversification into booze with the purchase of Funkin in 2015. “That broadened his market experience and will come in handy at C&C, which is active in beer, cider and wine,” he adds.
C&C Group will doubtless have also been impressed with White’s stewardship of Scots icon Irn-Bru, given it includes Scottish beer Tennent’s among its stable of brands.
Recognising shoppers’ disappointment over the decision to reformulate Irn-Bru because of the sugar levy, White brought back the brand’s original formulation in 2021, which remains on sale to this day. Irn-Bru continues to go from strength to strength in a challenging soft drinks category, and is now worth £168m [NIQ 52 w/e 7 September].
C&C Group is at a crossroads
White joins C&C Group at a critical juncture. The Magners supplier has had a torrid couple of years, with a botched IT upgrade in its distribution arm, historic accounting errors and declining booze consumption (particularly across mainstream brands and in the on-trade) all denting investor confidence.
After C&C’s last permanent CEO Patrick McMahon stepped down in June over historic accounting errors during his time as CFO, activist investor Engine Capital urged the drinks group to consider selling up.
“C&C has been a perennial underperformer and today is deeply misunderstood and undervalued by the market because of a combination of structural and self-inflicted problems,” it said at the time.
Now, the supplier insists it is making progress on returning to profitable growth. Its latest results revealed underlying operating profits increased 29% to £33.2m (€40.3m) in the six months to 31 August. The business was on track to achieve £66m (€80m) in operating profits for the full year, despite revenues sliding by 3%, it said.
“Despite unfavourable summer weather, our brands demonstrated inherent appeal and resilience with both Tennent’s and Bulmers growing market share and Menabrea and Orchard Pig achieving double-digit revenue growth,” said interim CEO and chairman Ralph Findlay.
White is the man for the job
The arrival of a highly competent and high-profile CEO like White looks like another step in the right direction, with his pay packet (a base salary of £650k, with generous signing on fee and performance bonuses) reflecting those decades of experience. After a slow start, shares in C&C Group had climbed up 1.4% by lunchtime trading.
White’s hire was “a significant coup for C&C and complements the existing strong and experienced management team”, noted Shore Capital research analyst Greg Johnson in a note to clients on Thursday (12 December). “With some of the challenges now behind them, we believe C&C is well set to deliver a significant improvement in profitability.”
Key focuses for White are likely to include “building margins in distribution, growing its premium drinks business and improving the performance of Magners in the UK,” Johnson said. “C&C is a fundamentally sound business with strong brands, market-leading positions in Scotland and Ireland and unique… capabilities in distribution”.
One imagines White is itching to get started.
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