AG Barr has reported strong sales momentum, with Barr Soft Drinks up 12.3% and the Funkin brand up 21.4% during the 26 weeks to the end of July.
The Cumbernauld-headquartered soft drinks producer also revealed adjusted half-year profits before tax rising 22.8% from £20.6m to £25.3m, on the back of a 20% increase in like-for-like revenue to £157.9m.
The interim results statement also noted that the board has declared an interim dividend of 2.5 pence per share - up from 2p the same time last year.
Trading benefited from year-on-year Covid-19 recovery, particularly in the on-trade and out of home sectors, as well as good summer weather.
Operating margins, while impacted by cost inflation, were been supported by sales growth, cost control and the company's 'flexible' pricing approach.
At the end of July, the balance sheet showed £61.3m of cash and cash equivalents.
Chief executive Roger White commented: “We made a very strong start to the year and continue to see good momentum across our business and brands - that said, the UK’s high level of inflation has accelerated across the summer and is creating a well documented cost of living crisis for many consumers, alongside increasing challenges for industry.
“We continue to take action to mitigate the cost pressures we face both in the short term across the balance of the current financial year and where possible into 2023.
“We anticipate in the coming months that the current economic environment will impact consumer purchasing behaviour, however we currently remain confident that our strategy and actions will allow us to deliver a full-year profit performance ahead of the prior year.”
Commenting on the results, RBC Brewin Dolphin senior investment manager John Moore said the underlined the company's resilience.
“The cost of living crisis and rising energy costs are significant uncertainties for the company, but there is a confidence in today’s statement that suggests the management team are ready to weather the storm.
“The 25% increase to the dividend is also good news for shareholders and is well covered by a strong balance sheet, with cash built up over the past two years.
“AG Barr has a core set of brands performing well, the question is what the company will do next with its investments in STRYKK and Moma, and what other investment opportunities may come up in the changing and uncertain business environment.”
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