AG Barr shrugs off poor summer weather to boost first-half sales

The soft drinks group behind Irn-Bru shrugged off the impact of disappointing early summer weather to boost first-half sales by more than 5 per cent after a “highly effective” marketing campaign during the Euros football tournament.
AG Barr lifted revenue from £210.4 million to £221.3 million in the 26 weeks to July 27, with both its Rubicon and Irn-Bru brands delivering both volume and price gains.
The soft drinks side of the business as a whole increased sales by 7 per cent to £194.6 million in the half, with Rubicon identified as the “stand-out performer” on the back of double-digit growth.
However, the growth was offset by a 9.4 per cent decline in sales to £21.1 million of the Funkin cocktail brand, which was hit by the challenges facing late-night venues as bar and restaurant trade continues to struggle with weak consumer demand.
It said the value of cocktails in the on-trade had fallen by 1.3 per cent over the past year, mainly due to a 1.9 per cent fall in the number of venues. It said: “Whilst we expect on-trade cocktail consumption to return to growth in the longer term, this may take some time given current economic and consumer trends.”
Pre-tax profit also fell sharply, losing 10.4 per cent to £24.9 million after one-off costs of £4.4 million relating to the closure of Barr Direct and the integration of Boost, the energy drink brand which it acquired in 2022.
On an adjusted basis, pre-tax profits grew by 8.5 per cent to £29.3 million. The Moma oats business, acquired in 2021, gained further distribution and increased revenues by 7.7 per cent to £5.6 million in the first half.
Shares of Barr, which declared an interim dividend up 17 per cent to 3.1p, fell 56p, or 8.5 per cent, to close at 606p.
Euan Sutherland, 55, who took over as chief executive from Roger White in May, said his first few months had “further cemented my view that AG Barr is an excellent business with exciting, tangible and deliverable growth opportunities”.
Sutherland said he anticipated a strong performance from its four core brands — Irn-Bru, Rubicon, Boost and Funkin — in particular, with current trading momentum underpinned by further marketing and innovation activities.
“Guidance on 2024/25 revenue and operating margin is unchanged,” he said. “We remain confident of continued, sustainable growth over the long term, in line with our strategic ambitions.”
Analysts said the figures suggested healthy market share gains, particularly. Rubicon’s fruit juice range was especially strong, while Irn-Bru also experienced growth and market share gains. The group’s core brand, Irn-Bru, sometimes known as Scotland’s favourite tipple, was also in growth.
Sutherland, who joined the Cumbernauld-based group in May, is a retail specialist, who has run Saga, Supergroup and the Co-op.