C&C Group has seen operating profit increase at its Irish operation by 11.2% in the six months to end August 2014, according to accounts filed this morning.
Net revenue at the Irish business, which now also includes its Northern Ireland operations, declined 3.9% to €158.2 million in the six month period. Operating profit margin increased 3.2pts to 23.2%.
The group's core cider business, however, saw volumes in Ireland decline by 4.4%, while cider net revenue decreased by 5.7%. C&C cited 'price deflation in the off-trade and the negative impact of a swing from on to off-trade' as having contributed to this decline.
Ireland, along with Scotland, delivered profits of €69.2 million in the period, which represents 86% of operating profit. C&C's Scotland business, where it produces Tennents lager, saw net revenue increase by 69.1% and operating profit rise by 14.3%.
"Central to both are strong brands and excellence in customer service. In these geographies we are delivering on our differentiated and focussed strategy of creating multi-beverage branded distribution models," said Stephen Glancey, C&C Group chief executive.
"In Ireland we combined our operations, and the C&C Gleeson’s business now spans the Island of Ireland. With integration of the Gleeson’s business complete and improving consumer sentiment, we are well positioned to drive future earnings growth."
However, England & Wales operating profit declined by 36.8% and US operating profit declined by 89.6%, with the performance of its Woodchuck cider brand 'well behind expectations'.
On the group's controversial bid for the Spirit pub group, which was rejected by the Spirit board last week, C&C said that "Our route-to-market capability in Ireland & Scotland is not matched in England and Wales and the concept of vertical integration in the sector is well established. Against this backdrop the Group are of the view that our commercial interests could be materially enhanced through direct participation in the management of high quality retail assets."
© 2014 - Checkout Magazine by Stephen Wynne-Jones
