Fevertree ups dividend after lockdown boost to at-home drinking
FEVERTREE DRINKS
1,098.00p
08:24 26/04/24
Fevertree Drinks has increased its interim dividend, despite the Covid-19 crisis causing revenues to loss some of their fizz.
Beverages
22,199.09
08:39 26/04/24
FTSE AIM 100
3,643.58
08:40 26/04/24
FTSE AIM 50
3,963.40
08:40 26/04/24
FTSE AIM All-Share
755.63
08:40 26/04/24
The mixer specialist reported revenues in the six months to 30 June of £104.2m, an 11% fall. Adjusted earnings before interest, tax, deductibles and amortisation slid 35% to £23.8m.
However, the Aim-listed firm called the first-half performance “resilient” against the backdrop of the global pandemic and lockdown, and upped the interim payout by 4%.
“Paying a dividend of 5.41p per share [reflects] the financial strength, confidence in the business, as well as our strong cash generation,” Fevertree noted.
The on-trade, which normally represents around half of UK revenues at Fevertree, reported a 61% slide in revenues after pubs and restaurants were closed by Covid-19.
However, the off-trade performed ahead of expectations, as consumers drunk more at home.
Tim Warrillow, chief executive, said: “Our performance in the off-trade over the first half of the year has been encouraging, with sales across our regions exceeding our expectations. People’s interest and excitement about mixing drinks at home has really taken hold over the lockdown period.
“Consequently, we have increase our penetration of the UK, consolidated our number one position, and driven value share gains in the US, Europe and as far afield as Canada and Australia.”
Warrillow added that the second half had so far been “encouraging”.
As at 1150 BST, shares in Fevertree were off 2% at 2,080.91p.
Wayne Brown, analyst at Liberum, called the half-year numbers “solid”, adding: “For the full year, the company is now guiding for revenues of between £235m and £243m, in line with the current consensus of around £240m. The guidance assumes no further significant lockdowns, and a continued gradual recovery of the On-trade.”
Liberum has a ‘buy’ recommendation on the stock.