Drinks group C&C has confirmed a gloomy outlook for its financial year to the end of February, mainly as a result of disappointing cider sales in Britain.
C&C said sales were expected to decline by around 9% compared with the previous year, while its operating margin is expected to drop by ten percentage points. The figures are in line with a statement issued last month.
The poor performance reflects problems in the cider market, where C&C's Magners brand has lost market share in Britain. Cider sales have also been hit by poor summer weather, while the company also faced an increase in costs.
Total cider sales for the year are set to fall by 10%, with a 4% drop for Bulmers in Ireland and a 15% slump for Magners. Magners volumes fell by 28% in the second half of the year, though C&C said it had grown strongly in the off-licence market in the UK.
C&C said it expected the cider business to return to growth in the next financial year, if summer weather was 'normal', as it planned a strong advertising campaign and a stronger commercial presence in Britain. C&C is also launching draught Magners in Britain in May.
The company's spirits and liqueur division is expected to grow by 5%, lifted by strong growth for Tullamore Dew, but revenue at the distribution division is set to drop by at least 10% as a result of the loss of the Fosters wine business at the end of the previous year.
C&C is maintaining its final dividend at 15 cent, giving a total of 27 cent for the year.
C&C shares were flat at €4.50 at the close in Dublin.
