Nichols: Costs take a bite out of Vimto maker’s earnings
Vimto maker Nichols said it is continuing to trade in line with expectations despite posting an 8.1 per cent decline in earnings before interest, taxes, depreciation, and amortisation (EBITDA).
This morning, the drinks brand which also owns the sugary Slush Puppie brand, said revenue rose by just 3.5 per cent to £170.7m.
David Taylor, interim chief financial officer said: “This increase [in revenue] reflected further progress in our export sales and increased prices arising from our response to higher input costs, which has been partially offset by the fall in revenue following the restructuring of our OoH business.”
“We raised prices to recover significantly higher material input costs early in the year where we were unable to mitigate these costs, with the expectation that we would lose some volume in the UK as a result of our decision to protect our gross margins.”
Adjusted profit before tax also grew by 8.7 per cent to £27.2m, however, EBITDA fell by 8.1 per cent to £24.7m.
Despite this, the publicly listed firm said it experienced strong growth across its packaged business and was also bolstered by seasonal holidays such as Ramadan.
Andrew Milne, chief executive officer of Nichols, said: “Building on the progress achieved in 2023, I am confident about our prospects for 2024 and the well-defined strategy we have in place to drive further growth.
“Our diversified business model provides the foundation for continued success, reinforced by our well-established portfolio of owned and licensed brands, the close partnerships we have with our suppliers and customers and our long-term strategic focus.”
He added: These strengths, coupled with a resilient soft drinks market and the dedication of our people, will enable us to continue to deliver value to shareholders.”
Ex-Cadbury financial controller Richard Newman will step into the role of permanent CFO later this month.