C&C Rises as Tennent’s Beer Helps Export Expansion: Dublin Mover
C&C Group Plc (GCC), the maker of Magners cider, rose the most in five weeks after reporting revenue growth in export markets and at its beer unit, even amid “challenging” business conditions in the U.K. and Ireland.
C&C jumped as much as 2.8 percent to 3.26 euros as of 8:55 a.m. in Dublin in the biggest intraday gain since May 22. The stock has increased 14 percent this year.
Sales outside Ireland and the U.K. surged 63 percent and revenue at the Tennent’s beer unit increased as C&C raised prices and sold more expensive variants in the period from March 1 to today, the Dublin-based company said in a statement today. Revenue and volume slid in the U.K. and Ireland as rainy weather discouraged shopping.
C&C expects to report operating profit in a range of 112 million euros ($140 million) to 118 million euros for the year through February 2013, it said. The median estimate of nine analysts was for profit on the same basis of 117.7 million euros. Operating profit, excluding some items, was 111.2 million euros last year.
Exports have “performed well,” and the operating profit forecast should “give investors some reassurance,” Phil Carroll, an analyst at Shore Capital in Liverpool, wrote in a report today. “Whilst this update is weak, particularly in the U.K. it is not surprising.”
C&C will increase “commercial support and brand activity” for its ciders, which include Magners and Gaymers, and expects volume and revenue to increase, it said. The company gets the majority of revenue from cider.
“Despite a challenging quarter and tough consumer backdrop, we are confident that our resilient business model and strong brand market combinations will deliver continued earnings growth for the full year and maintain our business momentum,” Chief Executive Officer Stephen Glancey said in the statement.
British and Irish consumer-goods companies are looking to sales outside their home markets as government spending cuts to address a record budget deficit hurt consumer confidence. Retail sales slid 2.4 percent in the U.K. in April, hurt by the wettest weather on record for the month, according to the Office for National Statistics.
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