Shares in drinks group C&C fell by almost 10% in Dublin today after it signalled lower than expected profit growth for the coming financial year.
In a trading statement released this morning, C&C signalled that its sales for the year to the end of February would be 25% ahead of the previous year, lifted by a continuing strong performance by its Magners cider brand in Britain.
Chief executive Maurice Pratt said its focus this year would be on increasing Magners' market share in Britain, while it would also test the brand in two European markets.
C&C said its operating margin would rise by around six points despite heavy investment in marketing. It said that, as previously indicated, earnings would be lower because of heavy capital investment in increasing its cider capacity. It also said profits would grow by 15-25% next year, below what analysts had expected,
C&C said turnover in its cider division would jump by around 80%, with a 5% increase for its Irish brand Bulmers and 225% for Magners. It said a good summer had helped Bulmers to outperform in a flat market.
C&C said growth of Magners in Britain was constrained in the second half of the year as the group did not have enough manufacturing capacity to cope with demand.
Shares in the company were down €1.13 at €10.50 at the closing bell in Dublin this evening.
