A.G. Barr Full-Year Profit Rises 26% on Increased Revenue
A.G. Barr Plc, whose Irn-Bru soda outsells Coca-Cola in Scotland, said fiscal full-year profit rose 26 percent as it gained market share on higher sales.
Net income in the year ended Jan. 29 rose to 22.6 million pounds ($36.1 million), or 58.5 pence a share, from 17.9 million pounds, or 46.5 pence, a year earlier, Cumbernauld, Scotland- based Barr said in a statement today. Revenue increased 10 percent to 222.4 million pounds. Earnings and revenue beat analysts’ estimates.
“We remain cautiously optimistic, but realistic about the world we operate in,” Chief Executive Officer Roger White said in a telephone interview today. “Consumer confidence is a little more stretched this year than perhaps it was in 2010.”
Scotland is the only European country where the local soda is more popular than Coca-Cola or Pepsi-Cola. Barr, which also makes Tizer, Orangina and Lipton Ice Tea, is looking to boost sales in bigger markets including England and Russia.
The shares rose 46 pence, or 4 percent, to 1,201 pence in London trading. That was the biggest gain in more than seven months and the highest price in four months, valuing the company at about 467 million pounds. The stock gained 25 percent in the past year.
The U.K. soft drinks market grew 7 percent in value last year and 3 percent in volume, said Barr, which owns Strathmore Water, citing AC Nielsen Co. data.
Barr may be free of debt in 18 months to two years as strong cash flow enables it to repay banks loans faster than expected, White said. Sales for the first eight weeks of the fiscal year are ahead of last year, the company said.
The company raised its total dividend for the year 10 percent to 25.4 pence a share.
“Barr’s results are ahead of expectations on all lines,” Collins Stewart Plc (CLST) analyst Wayne Brown, who recommends investors “buy” the shares, said in a note to clients today.
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