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Locked down Brits hitting the gin boosts Fever-Tree

Published:  04 June, 2020

Fever-tree has reported a strong performance for its premium mixers across the off-trade boosted by locked down Brits hitting gin.  

Off-trade sales of the company’s mixers rose 24% in the first full month of the lockdown, the company announced this morning, adding it had seen continued positive momentum since, reflecting increased at-home consumption during the period.

The core tonic range had performed “particularly well”, said the business, adding there had also been “notable growth” in the convenience channel as consumers increasingly supplement or substitute their trips to large grocery stores.

But with the on-trade, which represent around 50% of UK revenue and continue to be severely impacted by the lockdown, the overall picture is less rosy. 

Given the prospect of continued social distancing measures even when pubs reopen, Fever-Tree said it can’t predict full-year results.

However, although the company has been impacted by the pandemic, it was “well positioned to manage our way through the current situation”, said chairman Bill Ronald in a statement released ahead of the company’s AGM later today.

“We have a fantastic team across the globe who have been working incredibly hard alongside our key customers, suppliers and distribution partners. 

“Our asset light business model continues to support our secure financial position with a FY19 net cash position of £128m and we benefit from a strong brand portfolio with well-balanced revenue streams across regions, channels and customers.”

In the US, which is weighted to the off-trade (70%), off-trade sales had been “extremely strong” during the same period, boosted both by increased consumption but also new distribution deals.

Within Europe, the impacts from Covid-19 has varied across countries, said Fever-tree.

While Northern Europe is naturally weighted to the off-trade and has therefore been more robust, Southern Europe is more reliant on the on-trade, causing it to be more significantly affected.

However, Fever-Tree said it remains confident in “building our momentum in this region over the medium and long-term as premiumisation continues to gain traction”.