Top story

C&C Group (CCR) has reported a 10.3% fall in operating profits for the year to 29 February 2016 after poor weather and tough market conditions hit trading in Ireland and Scotland.

The Magners maker reported operating profit of €103.2m and EBITDA 12.4% down to €122.6m after a year which saw net revenues decline by 3.1% to €662.6m.

Net revenue was down 10.5% in its home territory of Ireland to €261.6m, with operating profit dropping 17.4% to €49m.

Its other key market in Scotland, which has been impacted by the tightening of drink driving laws, saw net revenues drop 6.8% to €339.8m, while operating profit was down 11.2% to €37.9m.

Both the beer and cider markets in the UK “remain challenging”, C&C Group added, with volume for its brands category down 2% in FY2016 and the off-trade off 3%.

Stephen Glancey, Group CEO, commented: “In our domestic businesses in Ireland and Scotland we faced a range of challenges including poor weather, increased competitor dynamics and of course the impact in Scotland of the changes to drink driving regulations.”

However, he added: “Cider is now penetrating deeper into international markets as consumers are attracted to the sweet natural taste. We are pleased to report growth not only in the UK but across our Export business, where cider grew by 15% over the past 12 months and with momentum sustaining into the current year.”

Its branded volume grew in double-digits in each of its main export regions of Europe, Asia and Australia.

C&C said it remains on track to deliver €15m of cost savings, the initial benefits of which will start to flow through in the 2017 financial year.

C&C’s shares are up 0.2% to €4.10 this morning.

Morning update

Catering and food group Compass Group (CPG) has reported a 6.4% rise in operating profit before restructuring to £735m on revenues up 5.8% to £9.7bn in the first half of its financial year.

The six months to 31 March 2016 saw “excellent” organic revenue growth of 5.8%, with organic sales up 8.3% in North America, up 3.7% in Europe and up 5% in rest of the world.

Compass said its expectations for the full-year are “positive” and remain unchanged and the group is on track to deliver the expected savings from its restructuring programme announced in July 2015.

Chief exec Richard Cousins said: “Compass has had another strong six months. We continue to drive operating efficiencies around the business, which is being reinvested in the growth opportunities we see.

“Our pipeline of new contracts is encouraging and our focus on organic growth, efficiencies and cash gives us confidence in achieving another year of delivery. In the longer term, we remain excited about the significant structural growth opportunities globally and the potential for further revenue growth, margin improvement, as well as continued returns to shareholders through dividends and ongoing share buybacks.”

Compass Group shares are up 1.3% to 1,278p this morning.

More widely the FTSE 100 has edged down 0.1% to 6,151.4pts.

Notable movers include Nichols (NICL), up 1.8% to 1,334p and Just Eat (JE), up 1.2% to 414.8p. 

Applegreen (APGN) is down 3.9% to 348.3p, Real Good Food (RGD), down 1.7% to 40.3p and McColl’s (MCLS) is down 1.2% to 156.3p.

Yesterday in the City

Yesterday market the first day of trading as a listed company for Hotel Chocolat, with the market welcoming the chocolate supplier and retailer sending its shares up a whopping 28% on its debut to 190p having floated at 148p.

The share price rise means the business is now valued at £214m.

More generally, the FTSE 100 was up 0.7% to 6156.7p largely thanks to the continued recovery in global prices.

Amongst grocery stocks, the most notable mover was Ocado (OCDO), which leapt 9.3% to 295p. Ocado has been one of the market’s more volatile stocks in recent times and yesterday’s jump didn’t appear to have an obvious cause other the reversing the falls Ocado had seen over the preceding three days.

Elsewhere, Greencore (GNC) was up 2.6% to 376.5p before its half year results this morning and Tesco (TSCO) was up 2% back to 159.9p after its tough share price run in recent weeks.

Other risers included Dairy Crest (DCG), up 1.1% to 574p and SSP Group (SSP), up 0.8% to 291.8p.

Associated British Foods (ABF) dropped 1.7% to 3113p, Cranswick (CWK) was down 1.4% to 2,356p and Greggs (GRG) dropped 0.7% to 1,089p after its strong start to the week.

Topics