Irn Bru maker AG Barr reports strong rise in profits
Soft drinks firm AG Barr has reported a healthy rise in annual profits following a strong performance by its water brand, Strathmore.
The Cumbernauld-based company said profit before tax and exceptional items climbed by 10% to £41.9m in the year to 25 January.
Total turnover increased by 2.7% to £260.9m.
Barr said core brands Irn Bru, Barr, Rubicon and Strathmore all outperformed the market.
However, it warned that the UK soft drinks market was experiencing a period of price deflation which could make it more difficult for many businesses to deliver the top-line growth of recent years.
Barr also warned that consumer preferences were changing in the soft drinks market, adding that "areas where traditional growth has been available are now proving more difficult to generate growth, making differentiated brands and appealing to consumers more important than ever".
In its results statement, Barr said Strathmore sales fared particularly well in the stills segment, growing by more than 20% over the year.
The brand was boosted by Barr's Glasgow 2014 Commonwealth Games sponsorship and the growing popularity of water in the UK soft drinks market, the company said.
Over the year Irn Bru invoiced sales grew by 1.6%, with sales of Irn Bru ice cream reaching nearly £1m.
Barr said its Irn Bru brand performed well in England and Wales, with sales up by 5.6%. The brand's sugar-free version saw sales up by more than 20%.
Barr said it now planned to "target increased levels of distribution and brand awareness" further into England and Wales this year.
The board has recommended a final dividend of 9.01p per share, to give a total dividend for the year of 12.12p - a full-year increase of 10% on the previous year.
Chief executive Roger White said: "We have delivered an excellent financial performance in difficult market conditions over the past 12 months, whilst continuing to build the platform required for sustained and profitable long-term growth.
"Looking forward, we will continue our approach of tight cost control, rigorous cash management and focus on execution whilst continuing to invest for the long-term in our brands, assets and people.
"Overall market conditions are expected to remain challenging."