Chelmsford: Britvic confirms closure of factory as annual profits climb 28%
Soft drinks group Britvic today reported strong growth in annual sales and profits as it confirmed that its factories in Chelmsford and Huddersfield will close by May next year in a drive to trim costs by £30million a year.
Britvic posted a profit before tax and exceptional items of £108.1million for the 52 weeks to September 29, up 28% on the previous year’s figure of £84.4m, while one-off costs of £25.5m left a bottom-line pre-tax total of £82.6m, against £77.5m.
Group revenues were 5.2% up at £1.321billion compared with £1.256bn the previous year, representing annual growth of 4.4% adjusted for currency movements.
Adjusted earnings per share were 27.5% up at 35.2p and the full-year dividend will increase by 4% to 18.4p pere share.
Britvic said Fruit Shoot’s share of the Great Britain market had returned to the levels seen before the product recall during the summer of 2012 due to concerns over the safety of a new design of bottle cap, and were now ahead of former levels internationally.
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The group added that a new agreement with PepsiCo of a 15-year bottling agreement would see Fruit Shoot being disributed across 41 US states during 2014.
Chief executive Simon Litherland said: “We have delivered a strong financial performance in a year of significant change for our business.
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“We have grown revenue and price in all of our business units and gained market value share, resulting in operating profit growth in excess of 18%. We have also reduced debt by nearly 10%, on the back of improved free cash flow generation.
“We have made good progress on the strategic initiatives that we communicated back in May and remain on-track to deliver £30m per annum of cost savings from 2016. Today’s announcement of a new agreement with PepsiCo Americas Beverages for significant additional expansion in the USA is further evidence of the growth opportunities that exist for our brands internationally.”
And he added: “While we anticipate that the consumer environment will remain challenging in 2014, trading in the new financial year is slightly ahead of a strong first quarter performance last year.”
Britvic announced in May this year that it planned to close its factory in Chelmsford, which makes soft drinks in cans, glass and plastic bottles, putting more than 200 jobs at risk.
It also said it was closing its Pennine Spring water factory in Huddersfield with the loss of a further 40 jobs as part of a reorganisation aimed at cutting costs of £30m a year.
The group said today that the restructuring process was due to be largely completed by the second quarter of 2014.
“We are now working hard to simplify our internal ways of working across all functions and will continue to fully support all employees impacted by change, including those in the supply chain who will leave the business between February and May 2014, or relocate between sites following the closure of Chelmsford and Huddersfield,” it added.
Work from the two plants will transfer to other sites in the UK, Ireland and France, with Britvic’s other UK locations including major operations in east London, Norwich and Leeds.
Britvic has an association with Chelmsford stretching back almost 150 years. The present factory was built in 1954 and until last year the group also had its head office the city. It is now based in Hemel Hempstead, Hertfordshire.