According to CEO David Ford, C&C’s deal to exit Admiral Tavern while retaining the contract to supply the UK pub chain is a “win-win” for the Irish beverage conglomerate.
The head of producer of Bullmers Cider, Tennant Lager and Tipperary Water, dismissed a suggestion that exiting five years after buying a 49 pc stake in the pub chain was an audacity for the group.
Mr Ford said the sale to US investment firm Proprium Capital Partners raised €65.8m which will help ease the business and C&C signed a long-term agreement to supply its owned and agency brands to Admiral following the sale. Conversed on.
“It feels like a win,” he said.
He said that Admiral’s stake helped C&C create distribution, but it was effectively dropped after the company later decided to buy beverage distributors Matthew Clark and Bibendam.
“We now have the most powerful distribution platform in the UK and it was worth revisiting what role Admiral Tavern can play,” he said.
C&C’s net revenue rose 87.8pc to €1.4bn in the 12 months to the end of February, as pandemic restrictions were lifted and minimum unit pricing was introduced. Sales were still below pre-pandemic levels, reflecting most of the restrictions last year.
While on-trade sales are now recovering, C&C warned of a potential price hike as costs increase, adding that rising cost of living could affect future consumer demand.
On the flip slide, Mr. Ford said the minimum unit price of alcohol introduced in Ireland this year puts supermarket own-brand products at a disadvantage relative to branded drinks like C&C’s because of the price difference between premium and generic drinks. has decreased.
For the full year 2022 C&C reported an operating profit of €47.9m, compared to a €63.6m loss in 2021, with an operating margin of 3.3pc for the full year.
Revenue in ‘on trade’ – bars, restaurants and cafes – grew 207.8 percent with 150 more business days compared to 2021.
‘Off-trade’ performance was down 3.4 per cent compared to 2021.
Basic earnings per share rose 9.9 cents, compared to last year’s loss of 31.1 percent, while diluted earnings per share rose to 7.5 cents compared to last year’s loss of 21.1 percent.
The company indicated plans to reintroduce dividends.
Shares of C&C closed at 212.6 pence, up 3.71 per cent in London, after the company’s results statement.