CCR: C&C Group PLC: Interim Management Statement

  CCR: C&C Group PLC: Interim Management Statement

UK Regulatory Announcement

DUBLIN

                         Interim Management Statement

Dublin, London, 16 January 2013: C&C Group plc (“C&C” or the “Group”), a
manufacturer, marketer and distributor of branded cider and beer, today issues
an Interim Management Statement covering the period from 1 September 2012 to
the date of this statement.

Performance Overview

  * Re-affirming operating profit guidance at the lower end of previously
    stated range of €112m to €118m, before the benefit of acquisitions.
  * Announced and completed the acquisition of the Vermont Hard Cider Company
    (VHCC), the leading US craft cider company. The business continues to
    deliver good volume growth and is expected to contribute €1.5m of EBIT in
    the period to 28 February 2013.
  * Announced the acquisition of the Gleeson Group, a leading supplier and
    distributor of beverages in Ireland. The acquisition is subject to Irish
    Competition Authority review.
  * Improved trading performance in ROI with volume growth in the third
    quarter following the weak summer trading period.
  * Strong revenue line performance from Tennent’s UK.
  * International cider and beer volume growth of 28% in the third quarter.
  * Trading environment for long alcoholic drinks (LAD) and cider in the UK
    remains very challenging. Relative improvements in C&C cider performance
    in the third quarter were moderate.
  * The Group retains a strong balance sheet. Assuming completion of the
    Gleeson Group acquisition before the year-end, FY 2013 pro-forma net debt
    to EBITDA ratio is expected to be less than 1.5 times.

Performance Review and Outlook

Despite the challenging trading and economic environment, C&C reaffirms its
guidance of operating profit at the lower end of the previously stated range
of €112m to €118m, before the benefit of acquisitions.

The acquisition of VHCC and the expected completion of the Gleeson deal
broaden the scale and scope of C&C and should improve the growth prospects of
the Group. C&C retains a strong balance sheet and the flexibility to invest
behind core markets and the internationalisation of cider.

Divisional Review

Republic of Ireland (ROI)

 
                           6 months        3 months          9 months
Change on Prior Year       ended           ended             ended
                           31 August       30 November       30 November
                           2012            2012              2012
                                                              
Volume                     (3.2%)          1.8%              (1.6%)
Net Revenue                (12.3%)         (3.5%)            (10.0%)
                                                              
Cider Volume               (6.6%)          0.9%              (4.4%)
Beer Volume                20.0%           7.0%              15.6%

ROI volumes in the third quarter were up 1.8%, representing a significant
improvement on the first half of the year. As anticipated, trading conditions
stabilised following an unseasonably wet summer period and volumes benefited
from trade buy-in ahead of the December duty rise. Pricing pressure continued
in the quarter, primarily in the off-trade, as promotional activity showed
little sign of easing. Volume continues to migrate from the on-trade to the
off-trade channel but the rate of migration was slower in the quarter.

Cider volumes increased by 0.9% with Bulmers performing steadily across both
channels of trade. Beer volumes increased 7%. This represents a slow down in
growth compared with the first half, against strong comparatives in the third
quarter of the prior year. Volumes of our core beer brand, Tennent’s, were up
22% in the quarter as the brand continues to build market share, albeit from a
small base position.

C&C announced the acquisition of the Gleeson Group, a leading supplier and
distributor of beverages in Ireland, in the period. The acquisition has the
potential to transform C&C’s existing Irish business through the addition of
an extensive distribution network and the opening up of an attractive,
multi-beverage brand platform. The acquisition is subject to Irish Competition
Authority review.

Cider – United Kingdom (UK)

                                                                    
                                 6 months        3 months          9 months
Change on Prior Year             ended           ended             ended
                                 31 August       30 November       30 November
                                 2012            2012              2012
                                                                    
Volume                           (18.6%)         (11.9%)           (16.8%)
Net Revenue (constant            (21.4%)         (19.1%)           (20.7%)
currency)
                                                                    
Magners Volume                   (17.4%)         (11.7%)           (15.9%)
Gaymers Volume                   (20.4%)         (12.3%)           (18.2%)

There has been little discernible improvement in the trading environment for
UK LAD in the third quarter. It remains a tough market for brand owners and
the increased competition in cider is adding to pricing pressure.

C&C cider volume declined 11.9% in the third quarter. This represents a
moderate improvement on the first half, reflecting increased levels of
off-trade promotional activity. However, price/mix deflation was 7.2% in the
quarter.

Magners volume fell by 11.7% in the third quarter. Again this was a slower
decline than in the first six months of FY13, as promotional activity and
price support behind the brand increased. The Gaymers portfolio performance
also showed a relative improvement on the first half of the year. The
introduction of new Gaymers fruit variants has had a positive impact on
volumes but the other brands in the Gaymers portfolio continue to drag on
overall performance

Tennent’s UK

                                                                    
                                 6 months        3 months          9 months
Change on Prior Year             ended           ended             ended
                                 31 August       30 November       30 November
                                 2012            2012              2012
                                                                    
Volume                           (6.3%)          (3.6%)            (5.5%)
Net Revenue (constant            7.3%            7.5%              7.3%
currency)

Tennent’s UK performance remains solid despite the volume decline in the third
quarter. Revenue increased 7.5% year on year.

Caledonia Best is performing well and in line with internal expectations. A
national advertising campaign in Scotland including TV and billboard activity
was launched over the Christmas period. Caledonia Best was recently announced
as the official beer of Scottish Rugby. The three year sponsorship deal will
see Caledonia Best become the beer partner to the Scottish National Rugby
Team, Edinburgh Rugby, Glasgow Warriors and the Glasgow 7s.

International (excluding VHCC)

                                                                    
                                 6 months        3 months          9 months
Change on Prior Year             ended           ended             ended
                                 31 August       30 November       30 November
                                 2012            2012              2012
                                                                    
Volume                           52.9%           28.1%             45.0%
Net Revenue (constant            39.6%           32.2%             37.4%
currency)

International beer and cider volume increased 28.1% in the third quarter.
Magners volume was up 16% in North America, in line with the growth rate of
the import market. Distribution issues for Magners in Australia remain a drag
on overall export volume for the brand but growth in other territories is
encouraging. The Hornsby’s brand was re-launched in October. The initial
performance and feedback from consumers and distributors is positive.

C&C announced and completed the acquisition of the Vermont Hard Cider Company
in the period. VHCC is the leading US craft cider company. The business
continues to deliver strong volume growth, in line with expectations.

It is expected that VHCC will contribute €1.5m of EBIT in the period from
completion to 28 February 2013.

Third Party Brands

                                                                    
                                 6 months        3 months          9 months
Change on Prior Year             ended           ended             ended
                                 31 August       30 November       30 November
                                 2012            2012              2012
                                                                    
Volume                           (7.6%)          (7.3%)            (7.5%)
Net Revenue (constant            (7.9%)          (16.5%)           (10.5%)
currency)

Third Party Brands volume and revenue declines in the quarter reflect changes
in the route to market for a number of factored and licensed brands in
Scotland and Northern Ireland. The volume loss is in low margin channels of
trade and of limited consequence for operating profits. During the quarter,
manufactured own-label volume grew by 14.6% as new contracts commenced.

Trading since 1 December 2012

Trading over the Christmas period was mixed between markets. In ROI, despite
the pre-duty increase trade stock build in November, Christmas trading was
ahead of internal expectations. Retail data in the UK off-trade suggests a
more muted festive trading period in general and for LAD specifically.
Tennent’s trading over Christmas was resilient.

Good growth in export volume should continue in the last quarter of the year,
supported by the usual stock build in a number of markets ahead of St
Patrick’s Day.

                                     ENDS

About C&C Group plc

C&C Group plc is a manufacturer, marketer and distributor of branded cider and
beer. The Group manufactures Bulmers, the leading Irish cider brand, Magners,
the premium international cider brand, the Gaymer Cider Company range of
branded and private label ciders and the Tennent's beer brand. C&C Group also
owns Woodchuck and Hornsby’s, two of the leading craft cider brands in the
United States. The Group also distributes a number of beer brands in the
Scottish, Irish and Northern Irish markets, primarily for Anheuser-Busch
InBev.

Note regarding forward-looking statements

This announcement includes forward-looking statements, including statements
concerning current expectations about future financial performance and
economic and market conditions which C&C believe are reasonable. However,
these statements are neither promises nor guarantees, but are subject to risks
and uncertainties, including the specific factors discussed on page 33 and 34
of the 2012 Annual Report, that could cause actual results to differ
materially from those anticipated.

C&C Group plc | Contacts
C&C Group:
Alan Daly, +353 1 654 6239
Head of IR
alan.daly@candcgroup.ie
or
Investors & Analysts:
Mark Kenny/Jonathan Neilan, +353 1 663 3686
FTI Consulting
CandCGroup.SC@fticonsulting.com
or
Media Dublin:
Paddy Hughes, +353 1 260 5000
Drury
paddy.hughes@drury.ie
or
Media London:
Robert Ballantyne/Shanshan Willenbrock, +44 20 7930 0777
Cardew Group
robert.ballantyne@cardewgroup.com

Contact:

C&C Group PLC