Marketing

Bulmers sales volumes down 6.6%

Long Alcoholic Drink volumes here were down 1.8% in the 12 months to the 29th February 2020 according to the C&C Group which published its results for the year recently.
Although also down by 1.2%, on-trade LAD volumes trended more favourably than in 2018 where they’d been down 3.4%.

Although also down by 1.2%, on-trade LAD volumes trended more favourably than in 2018 where they’d been down 3.4%.

This drop may have been as a result of the stimulating effect of a good Summer and the World Cup on the previous year’s results, stated the company.

The off- trade drove the decline with a 2.5% reduction in volume on the previous year. But the 2020 figure was up 2.1% on the 2018 figures. Although also down by 1.2%, on-trade volumes trended more favourably than in 2018 where they’d been down 3.4%.

“While volumes decreased across the trade at -1.8% year-on-year, LAD value declined at a slower rate of -0.4% and remains +0.7% ahead of FY2018 levels,” stated the company, “The poor Summer weather in 2019 impacted cider’s share of LAD which reduced year-on-year to 12.7%.”

Cider’s share of the previous year’s LAD market had been 13.0%.

 

C&C’s Irish results

With overall volumes up 4.2% net revenues at the C&C Group’s Irish subsidiary were up 3.6% to €227.7 million from €219.8 million the previous year.

Own-brand alcohol was responsible for €85.1 million of the 2020 figure while “other sources” including wholesale (excluding MCB), own label, contract and Non-Alcoholic Beverage revenues) were responsible for the remaining €142.6 million.

However volume sales of its Bulmers cider brand here took a 6.6% tumble with net revenues down 7.7%. The brand’s share of the off-trade cider market declined from 49.2% to 46.8% in what C&C describes as “a highly competitive market”, stating, “Competition in the cider category remains intense with new product launches by major international brewers across beer and cider, heightening competition for bar space and consumer attention”.

Nevertheless Bulmers continues to sell at a 10% premium over standard lagers, states the company whose super-premium and craft portfolio witnessed volume growth of 22.4% over the year.

C&C’s Island of Ireland wholesale distribution company delivered “robust growth” in the year with net revenues up 5.3% though delivery to over 4,600 outlets.

And from the 1st July this year C&C can add the distribution rights for Budweiser – the number four LAD brand in Ireland to Bulmers number three – to its Island of Ireland portfolio.

However the shutdown of the hospitality sector has materially impacted C&C’s business, with no revenue generated in the on-trade channel since March.

April and May volumes for Bulmers were down only 16% thanks to a 62% increase in the off-trade to which the company has reallocated resources to capitalise on this behavioural shift.

“The ongoing closure of the hospitality sector has material implications for our business and earnings potential, with approximately 80% of our revenue derived from the on-trade channel,” commented C&C Group Chief Executive Steward Gilliland in the report.

As a result, the underlying “cash burn” sits at around €7 million per month while the pubs are closed.

“This is net of furlough employee support currently c €5m.” states the report.

C&C results

Overall, the C&C Group enjoyed a rise in revenues to €1.72 billion and it also grew its full-year Operating Profits by 10.4% to €116.4 million from €104.5 million.

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