According to the Group, FY2022 has delivered a strong return to trading, driven by the gradual easing of on-trade restrictions since April 202 and boosted further by a strong consumer response; a Summer of good weather; the European Football Championship and ‘staycations’.
Despite restrictions impacting indoor and outdoor hospitality in H1, the Group reports an improved performance for the first half of the financial year with indoor and outdoor hospitality open across its core markets for the last five weeks of H1. As a result, C&C was able to serve “90% of the distribution points in August 2021 versus August 2019”.
Group net revenue in the first half of its financial year is expected to be €657 million compared with €398m in H1 FY2021 and €896m in H1 FY2020 (pre-COVID-19).
Operating Profit is expected to be €16 million, compared to a loss of €12m in H1 FY2021 and a profit of €66m in H1 FY2020.
Its off-trade channel has continued to perform well with Bulmers growing its share of cider on an MAT basis versus a year and two years ago, it states.
With the gradual easing of restrictions in the UK on-trade from April 2021 the Group returned to profit and underlying cash generation in May 2021.
Trading performance continued to improve from May 2021 and Irish outdoor hospitality reopened from June 2021. C&C’s key distribution businesses, Matthew Clark and Bibendum, returned to profitability in June and remained profitable over the key Summer trading period, it reports. The Group discontinued the use of government furlough support schemes last June too.
As widely publicised the UK is experiencing a shortage of Heavy Goods Vehicle drivers but with the Group’s distribution network controlled in-house, it has been partly insulated and as a consequence has “broadly met customer demand” through the peak Summer trading period.
While there is general upward pressure on input costs and in its distribution business as it manages industrywide capacity constraints, its exposure to commodity inflation is largely mitigated in FY2022 through its long-term supply contracts and partnerships. According to the report, with its initiatives, C&C remains on track to deliver the €18 million in annualised cost savings announced in May.
“We continue to invest in our brands, most notably with the recent launch of multi-channel advertising campaigns for our iconic Tennent’s, Bulmers and Magners brands,” commented C&C’s Chief Executive David Forde.
C&C will announce FY2022 first half results on Thursday, the 28th of October at which time the Group intends to reinstate guidance.