British tonic maker Fevertree Drinks has forecast that annual core profit will fall short of market expectations.
The announcement comes even as profit doubled in the second half on strong US market performance, offsetting inflationary cost pressures in materials.
The drink mixer manufacturer said it now expects core profit for the year to be about £30 million, compared with its prior prediction of up to £36 million.
Analysts on average expected a core profit of around £32.7 million, according to a company provided consensus.
High Costs
Fevertree has been grappling with high glass costs in Britain ever since the Russia-Ukraine conflict pushed up energy costs.
As a result, the company was forced to initiate price increases to protect margins, while also ramping up its glass production in the US.
On Thursday, the company reported a 6% rise in total revenue for the year ended 31 December, which included a 22% growth in the US, its largest market by revenue.
It said it currently expected a significant improvement in gross margin for 2024, underpinned by new glass contracts with fully hedged energy pricing and lower Trans-Atlantic freight rates.
Separately, British soft drinks maker Britvic said it witnessed strong trading during the Christmas season. As a result, it is projecting that full-year results will be in the range of market expectations.
