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Rain and falling pound to dampen fortunes at AG Barr

Soft drink maker forecasts fall in first-half revenue
A taxi advertising Irn-Bru
Chief executive Roger White said costs were likely to rise in 2017

Wet weather and the plunge in the pound after 'Brexit' are set to take the fizz out of the fortunes of soft drinks maker A.G. Barr plc (LON:BAG).

Barr said rain in June and the early part of July is likely to hit the overall drink market in the first half of its financial year.

The company said trading had been highly competitive and it expects like-for-like revenue in the six months to fall 2.9% from a year earlier to £125mln.

In response to the government's imposition of a sugar tax on soft drinks, Barr has introduced a new zero-sugar version of its flagship Irn-Bru brand.

It has also launched low or zero-sugar versions of other drinks such as Rubicon and Snapple Iced Tea.

Chief executive Roger White said costs were likely to rise in 2017 as a result of the fall in the pound to 31-year lows following the EU referendum result.

"The decision of the UK to leave the EU has resulted in a degree of economic uncertainty and a weakening of sterling," he said.

"The balance of the summer will remain an important trading period; however, assuming market conditions improve and our robust second-half plans deliver, we expect to meet our full-year profit expectations."

Shares in Barr fell 1.61p to 534.39p in early London trading.

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AG Barr Timeline

September 27 2016

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