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Fever-Tree UK sales hit by retail slump

In the UK off-trade, the company’s performance had been “behind expectations”, reflecting the “wider slowdown in consumer retail spending”, said Fever-Tree in a trading update issued this morning.

Despite these “short-term headwinds”, Fever-Tree said it remained in a “very strong position” in the UK off-trade, maintaining its leadership position with 38% value share with “little impact" from the increasing number of premium competitors who collectively remain at under 5% value share.

It said it had continued to “perform well” in the UK on-trade, which accounts for half of the company’s UK revenue, despite “exceptionally strong comparators” in 2018.

Growth in key markets outside Britain, including the US and Europe, had continued to accelerate in the second half of the year, it added, with continued growth recorded across all four regions, it said.

“Despite challenging comparators, our performance in the UK on-trade underlines the strength of the brand and while the mixer category in the off-trade is moderating alongside the recent slowdown seen across the wider grocery channel, we continue to maintain our clear UK market leadership position,” said CEO Tim Warrillow.

Further afield, Fever-Tree's progress in the US was particularly encouraging, he added, with the signing of a US bottling partner a further step in building Fever-Tree's operations in "this exciting market,” he added.

Fever-Tree now expects revenue of £266m to £268m for the year ending 31 December 2019.

For the first half of 2019, sales across the group were up 13% climbing from £104.2m to £117.3m, with non-UK sales accounting for some 48% of global turnover at the time, up from 44%.

On the back of signing its first US bottling partner, Fever-Tree is poised to commence production on the West Coast in 2020.

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