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Products from the drinks company Fever Tree are displayed in London, Britain May 11, 2016. REUTERS
Sept 10 (Reuters) – Britain’s Fever-Tree Drinks posted a 9% rise in first-half adjusted core profit on Thursday after its UK business returned to growth and a hot summer boosted demand for its ginger beers and Mexican lime sodas.
- Fever-Tree has also locked in input costs years ahead, saying it was substantially hedged on glass and aluminium costs through 2026 to shield margins from geopolitical shocks.
- It has also hedged other commodity requirements substantially into 2028.
- The group, which has transferred some U.S. tariff risk to partner Molson Coors has also begun receiving tariff refunds.
- It expects the refunds to boost profitability in its U.S. segment in the second half.
- In the U.S., its largest market, half-yearly adjusted core profit fell 18%, as it spent heavily on marketing, despite an 11% rise in revenue at constant currency.
- UK revenue returned to growth, up 3%, helped by strong demand, market share gains and favourable summer weather.
- The group reported adjusted core profit of £20.1 million ($27.24 million) for the period, compared with £18.4 million a year earlier.
- The company said it has continued to trade well through the summer and is confident it will meet market expectations for the full year.
($1 = 0.7378 pound)
Reporting by Nithyashree R B in Bengaluru; Editing by Sherry Jacob-Phillips and Rashmi Aich
