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Nichols Delivers Strong First Half Performance

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Nichols Delivers Strong First Half Performance

Nichols Delivers Strong First Half Performance
July 24
11:54 2017

Nichols, the UK-based soft drinks group, has reported a 12.4% (10.7% on a constant currency basis) increase in revenue to £63.5 million for the first six months of 2017, and despite input cost challenges faced in the UK has grown adjusted profit before tax by 6.8% to £12.7 million.

Nichols has sales in over 85 countries, selling products in both the still and carbonate categories. The group is home to the iconic Vimto brand which is popular in the UK and around the world, particularly in the Middle East and Africa. Other brands in its portfolio include Feel Good, Starslush, Levi Roots and Sunkist.

In the UK, revenue rose by 6.7% to £47.5 million in the first half. This performance compares favourably to the total soft drinks market which showed total growth of 2.9% in the same period (Nielsen year to date to 17 June 2017). Within the UK, the Vimto brand has continued to outperform the market with sales up 10% versus the same period in 2016. The Vimto brand’s strong growth has been driven by both the still and carbonate segments and this sustained performance demonstrates the strength of this core brand.

International revenues increased by 33.5% in the period to £16.0 million, which is 24.7% on a constant currency basis. In Africa, revenues were up by 30.9% (20.2% on a constant currency basis), which continues the strong momentum reported in 2016. Sales to the Middle East were 19.8% ahead of the same period in 2016 (15.9% on a constant currency basis).

John Nichols, non-executive chairman of Nichols, says: “Nichols has delivered another strong performance in the first half of the year. Our sales momentum, which continues to outperform the UK market coupled with successful management of input costs has delivered solid profit growth.”

He continues: “Whilst we anticipate that market conditions will remain challenging during the second half of the year, we have a clear strategy and, underpinned by the strength of our brands and our diversified business model, we are confident of delivering full year results in line with expectations.”

Acquisitions are a key component of Nichols’ strategic growth plan, as demonstrated in recent years with the group’s successful move into frozen beverages via the purchase of The Noisy Drinks Co and the addition of the Feel Good brand.

Nichols has now added the DJ Drink Solutions business to its portfolio. DJ is the largest of Nichols’ out of home dispensed soft drinks distributors covering the North West and North East regions of the UK. The acquisition consolidates Nichol’s route to market in the two regions and is consistent with its successful business model already operating in other regions in the UK.

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