Bulmers and Tennent’s owner C&C reports revenue dip after IT issues
Drinks company C&C, which owns brands Tennent’s and Bulmers, has said earnings in the first half of its fiscal year have been “in line with expectations” as the group continues to recover from the software issues it experienced last year.
The FTSE-250 firm said it expected net revenue to fall by three per cent for the six months to 31 August, with operating profit expected to be €39m-€41m (£32m-£34m).
The firm said it remained confident it would achieve its operating profit target for the current financial year and reiterated its aim of reaching an operating profit of €100m (£84m) by 2027.
C&C said that the Euros boosted Tennent’s sales, while Bulmers outperformed the cider market in Ireland despite the mixed weather.
It also expected business with alcohol distributor Matthew Clark and wine specialist Bibendum to boost distribution margins.
The company’s performance was down last year after a botched software upgrade at the two businesses.
The group was hit by a one-off cost of around €25m (£21m) following the disruption, which impacted trading volumes and led to some customers jumping ship.
However, recovery of those lost customers has been “strong”, with distribution points for Matthew Clark and Bibendum in August up 10 per cent compared to August 2023, the company said.
Its search for a new chief executive is also officially underway, after Patrick McMahon was forced to step down over a series of financial errors which happened during his tenure.
His successor will be the firm’s fifth boss in the last five years. C&C has seen its share price fall more than 55 per cent in the last five years as it has struggled to retain senior leadership.
Back to Budweiser
C&C and Budweiser Brewing Group, part of AB InBev, agreed to “restructure elements of [their] trading relationship,” C&C said.
From 1 January 2025, C&C will reassume control and distribution of the AB Inbev’s cider portfolio, including Magners, in Great Britain.
On the same date, AB Inbev will assume control and distribution of its beer portfolio in the Off Trade in the Republic of Ireland.
“Bringing the sales, trade marketing and distribution responsibilities in house will provide both companies with the opportunity to strengthen their respective brand portfolios and distribution platforms,” C&C said.
C&C has been working with Budweiser Brewing Group since 2009 and had been responsible for brewing and distributing a selection of the brewer’s brands in Scotland, Northern Ireland and the Republic of Ireland.