Profits fizz at soft drinks group Britvic

The Britvic factory at Widford, near Chelmsford, which closed earlier this year.

The Britvic factory at Widford, near Chelmsford, which closed earlier this year.

Soft drinks company Britvic today reported a 23% jump in profits, helping by growing sales of more health-conscious fizzy drinks such as sugar free Pepsi Max.

Britvic said earnings lifted to £132.9million in the year to September 28 as its UK fizzy drinks brands grew volumes by 4.4% in a market which declined overall. Group sales rose 1.7% to £1.3billion.

Britvic, whose brands include Robinsons, Tango, J2O and Fruit Shoot, also produces Pepsi, 7UP and Mountain Dew Energy under an agreement with PepsiCo.

It said Pepsi Max was a key driver of sales following a marketing campaign featuring football stars Lionel Messi, Sergio Aguero and Jack Wilshere.

But Britvic, which rejected a merger with smaller rival AG Barr last July, said this year had begun slowly reflecting increasingly challenging trading conditions. Shares fell more than 2%.

During the period it said its still drink volumes, excluding water, fell 5% with Robinsons was impacted by own-label competition.

It added that that its premium juice drink, J20, saw its market share fall as customers focused on value when shopping for the home or on nights out.

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During the year Britvic stopped selling the full sugar version of children’s drink Fruit Shoot “as part of our commitment to address public health.”

In its international business it signed a 15-year franchise with US partner PepisCo to manufacture Fruit Shoot in the US, and also launched the drink in India during the summer.

Britvic said cost savings would total £25 million next year, and it was on track to deliver £30mof savings in 2016. In March this year, the company closed its former factory at Widford, near Chelmsford, having already relocated its head office from the city to Hemel Hempstead in Hertfordshire. It retains factories in Norwich, Leeds, Rugby and Beckton, in east London.

Chief executive Simon Litherland said today: “We have delivered revenue and margin growth, and profit significantly ahead of last year, despite challenging trading conditions in each of our markets.

“However we are confident of further improving our profitability in 2015, as we bring to market our strong innovation and marketing plans and benefit from the delivery of the cost savings programme.”