The first annual results after a stock exchange listing is always a landmark moment. For some companies it will be a pleasant surprise, but for others it heralds the moment investors realise the much-hyped IPO wasn’t such a good bet after all.
Fever-Tree’s results this morning haven’t exactly delighted investors, but haven’t sent them running for the hills either. Revenues at the drinks company, which makes premium tonic water and ginger beer, were up 49% in 2014 to £34.7m and its profits, in the form of adjusted EBITDA, were up 48% to £10m.
That’s a record most listed companies would be ecstatic about, but Fever-Tree’s investors don’t seem to be raising a glass. Its share price was down as much as 2.78% this morning to 210p.
To be fair though, the share price was already looking pretty fizzy. When Fever-Tree floated on AIM in November its IPO price was just 134p per share, and it has grown for most of the period since, peaking yesterday at 216p. A 3% dip isn't so painful given that performance - the company's shares have still risen around 56% since flotation.
‘2014 was a notable year for Fever-Tree as we continued to strengthen our market share and reputation as the leading international premium mixer brand,’ said its CEO and co-founder Tim Warrilow.
Fever-Tree's success is mianly the result of spotting a big gap in the market. Big brand mixers from the likes of Schweppes just aren't keeping up with the quality demanded by the sort of people willing to pay £30+ for a bottle of gin. The company has placed a big focus on exports and is now available in more than 50 countries after launching in India last year.
‘Encouragingly, growth came from all four of our international regions, illustrating the global appeal of the brand and was underpinned by strong margins and high cash conversion rates,' said Warrilow. 'We look forward to the year ahead with confidence.’ Anyone for a G&T?