Fevertree posts drop in interim profits but on track to meet FY expectations

(Sharecast News) - Fevertree Drinks said on Thursday that it was on track to meet full-year expectations as it reported a drop in interim pre-tax profit but broadly stable revenue, and extended its share buyback by a further £30m. Revenue was steady at £171m, or up 2% on the same period a year earlier at constant currency. Meanwhile, adjusted earnings before interest, tax, depreciation and amortisation ticked up 1% to £18.4m, with margins increasing by 20 basis points to 10.7%.

Pre-tax profit during the period declined 15% to £11.2m.

US revenue rose 4% to £62.4m, while UK revenue was 6% lower at £48.1m.

Fevertree said it recognised £4.1m in exceptional items in the period relating to the transition to the Molson Coors partnership.

It also said the combination of strong cash flow and transaction inflows from Molson Coors have significantly enhanced its position to £130m, up 97%.

The posh tonic maker said underlying Fevertree brand momentum in the US has remained strong through the initial period of the Molson Coors transition, with retail sales growth outpacing the market across every sub-category.

In the UK, Fevertree remains "the clear number one mixer brand" by value across both the On and Off-trade channels, with beyond tonic products performing strongly and now representing 30% of UK sales.

"While wider category headwinds resulted in a subdued performance across the On-Trade, the Off-Trade performance was robust, with significant growth in Premium Soft Drinks, Cocktail Mixers and Sodas," it said.

Chief executive Tim Warrillow said: "The announcement, in January, of our strategic partnership with Molson Coors was a moment of real significance for Fevertree, establishing the ideal platform to maximise our brand strength and future potential in what is our biggest growth opportunity.

"The transition of the business to Molson Coors is progressing well and despite the complexity of such a transition, it has been particularly encouraging to see the underlying US momentum has been maintained, a real testament to the hard work of both teams as well as the strength of the Fever-Tree brand."

The group hailed a "good" start to the second half of the year across its regions and said it remains comfortable with full-year market expectations.

Fevertree said the £100m share buyback programme announced earlier this year is progressing well and is expected to run until the end of this year. The company said it's extending the programme by a further £30m to continue in 2026.

At 0820 BST, the shares were up 7.4% at 832p.