Published: 03 Dec 2010
Last Updated: 03 Dec 2010
Britvic is the latest company to be sucked in by Ireland’s economic nightmare. The drinks maker, whose brands include Tango and Robinsons, has seen the value of its business plummet by £104m.
It's happened after a drop in sales in cash-strapped Ireland meant the company was forced to cut the value of its Irish assets. Britvic reported a 21.5% increase in profits to October but the exceptional charge on its Irish division meant the fizz fell flat on its results, leading the company to post a loss of £28.8m - down from profits of £66.2m last year.
Britvic has managed to cope fairly well against the downturn (it increased revenues by nearly 6% pre-acquisition). But its exposure in Ireland, which grew after it bought the rights to 7up and Pepsi in the country in 2007, is no doubt causing a headache. Furthermore, the drinks maker also faces rising input costs after a rise in the cost of plastic. Meanwhile a shortage of apples (blamed on a renewed Chinese enthusiasm for the fruit, which has apparently skyrocketed. Who knew?) has also led to prices rising for one of its vital ingredients. The company has a tough year ahead, but if it can manage to avoid prices rising for consumers then it might just survive against its more expensive competitors.
It's happened after a drop in sales in cash-strapped Ireland meant the company was forced to cut the value of its Irish assets. Britvic reported a 21.5% increase in profits to October but the exceptional charge on its Irish division meant the fizz fell flat on its results, leading the company to post a loss of £28.8m - down from profits of £66.2m last year.
Britvic has managed to cope fairly well against the downturn (it increased revenues by nearly 6% pre-acquisition). But its exposure in Ireland, which grew after it bought the rights to 7up and Pepsi in the country in 2007, is no doubt causing a headache. Furthermore, the drinks maker also faces rising input costs after a rise in the cost of plastic. Meanwhile a shortage of apples (blamed on a renewed Chinese enthusiasm for the fruit, which has apparently skyrocketed. Who knew?) has also led to prices rising for one of its vital ingredients. The company has a tough year ahead, but if it can manage to avoid prices rising for consumers then it might just survive against its more expensive competitors.
