AG Barr tipped as a festive winner

IRN-BRU maker AG Barr is expected to emerge as one of the winners from a cut-throat soft drinks price war over Christmas when it serves up a trading update on Tuesday.

AG Barr: Expected to announce positive trading update on Tuesday. Picture: TSPL

The Cumbernauld-based firm – which also produces Orangina, Rubicon and Tizer – revealed last month that sales growth had risen by 8 per cent in the 18 weeks to 1 December, with volumes up 6.4 per cent and the rest consisting of price hikes.

But it warned that the soft drinks market remained “highly competitive” in the run-up to Christmas, while festive trading figures from the “big four” supermarkets have shown it was a tough market for grocery sales.

Charles Pick, analyst at Numis Securities, is forecasting Barr to post revenue growth of 7 per cent overall for the second half, which would mark an increase on the 5.8 per cent seen in the first six months of its financial year.

Pick said the increase should come despite a tough comparison with a year earlier, adding the figure could even be higher “despite the known difficulties of the big four grocery multiples over Christmas and the competitive soft drinks market”.

The group’s half-year figures revealed the on-going legacy of its failed merger with Robinsons owner Britvic, with costs contributing to a 10 per cent fall in profits to £13.2 million.

The £4.9m of merger costs included fees for lawyers and advisers to get the deal past the Competition Commission.