Irn-Bru maker shrugs off Brexit risk as profits rise

The maker of Irn-Bru today reported a rise in annual profits as it flagged an 'unprecedented' level of uncertainty stemming from the UK's looming withdrawal from the European Union.

AG Barr chief Roger White said the soft drinks giant remained upbeat despite the 'uncertain' environment. Picture: Stewart Attwood

However, Cumbernauld-based AG Barr insisted that Brexit would not have a “significant” impact on its business – aside from weaker pound, which is driving up raw material costs.

• READ MORE: Irn-Bru maker vows to cut sugar across soft drinks

The group, which also produces Rubicon fruit juices, Strathmore water and Tizer, added: “We have a well-developed risk management framework in place at both functional and corporate levels of the business and we will continue to closely monitor political and commercial developments and react accordingly to these.”

Barr also announced plans today to return up to £30 million to shareholders over the next two years through a share buyback scheme.

It came as the firm reported a 2.7 per cent increase in pre-tax profits, before one-off items, to £42.4 million for the year ending 28 January, on underlying revenues 1.5 per cent higher at £257.1m.

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Barr hailed a “strong” performance among its core brands, with sales of Irn-Bru up 3.2 per cent in the year and Rubicon rising 4.9 per cent.

In response to changing consumer tastes and the UK government’s planned sugar tax, the group recently made a commitment that 90 per cent of its brands will contain less than 5g of total sugars per 100ml by the autumn.

“This means most of the group’s portfolio will not be subject to the UK’s new sugar tax regime due for introduction in summer 2018,” said analysts at Barclays.

• READ MORE: Irn-Bru maker to axe 90 jobs as sales lose fizz

Chief executive Roger White said: “We have made considerable progress across the business over the last 12 months and delivered a solid financial performance in volatile and uncertain market conditions.

“The UK consumer environment remains uncertain, however we are confident that our great brands, effective business model, clear strategy and strong team ensure we are well placed to realise the full potential of our business and to deliver consistent long-term shareholder value.”

In September, Barr unveiled plans to axe about 100 jobs in an effort to save some £3m a year, and today the firm said that the majority of these cuts have been made at a one-off cost of £3.3m.

Barr’s board proposed a final dividend of 10.87p a share, to be paid on 9 June, lifting the total payout for the year by 8 per cent to 14.4p.

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