Fever-Tree reports global expansion as UK growth slows

By Mathew Lyons

Published: 23 July, 2019

UK growth at premium-mixer brand Fever-Tree has slowed dramatically, according to the group’s interim half-year results released today.

UK half-year sales were up 5% to £60.7m, figures for the period ending 30 June 2019 showed. Last year, the company reported 73% growth in the UK market for the same period, with sales rising from £33.6m to £58m.

The company is the number-one mixer by value in both the UK off- and the on-trade, with market shares of 39% and 45% respectively, according to data from IRI and CGA.

However, growth elsewhere in the world continues to accelerate. Sales across the group were up 13% for the first half of 2019, climbing from £104.2m to £117.3m. Non-UK sales now account for some 48% of global turnover, up from 44%.

In the US, the company reported sales of £19.8m, up 31% on the first half of 2018. Fever-Tree brought its US operations entirely in-house in June last year.

Revenues in continental Europe rose 13%, with significant new listing across both the on- and the off-trade in France, Germany and Spain.

Sales in the rest of the world were up 49%, with Fever-Tree now having a 23% market share by value of the tonic market in both Australia and Canada.

Tim Warrillow, chief executive of Fever-Tree, said: “It has been an encouraging first half for the group with growth across all our four regions, most notably in the US, where we have made significant distribution gains and operational progress.

“While we have not been immune to the impact of the unseasonably poor weather in the UK, we have further strengthened our market leadership position within the UK and have seen positive momentum in Europe and the rest of the world reflecting our increasingly global footprint.

“The move to long mixed drinks is gathering momentum and starting to win share from beer and wine.

“While we remain mindful of the tough comparators over the remainder of the summer in the UK, the board anticipates that the outcome for the full year will be in line with its expectations.”

The company’s gross margins have slipped slightly from 53.2% to 51.9% reflecting ongoing investment costs internationally. Its adjusted EBITDA1 was up 8% to £36.7m.

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