Cider sales grow for first time in three years

By This Is Money
Updated: 09:46 EDT, 12 October 2010

Magners cider sales returned to growth for the first time in three years, said C&C Group.

Up and down: While Magners did well, Bulmers struggled in the Irish market

Its 'Method in the Magners' advertising campaign helped drive a 0.7% rise in British sales volumes of Magners during the six months to August 31 - the first increase since 2007.

The recovery contributed to a 29.4% increase in C&C's half-year earnings from continuing operations, to €63.4m (£55.2m).

Irish firm C&C has been benefiting from efforts to turn around its Magners sales in the UK, which saw double digit declines in recent years as the consumer boom in cider sales slowed.

It has since launched a marketing push and is driving through off-licence sales to help trading, while demand has also been boosted by the introduction of Magners Pear.

John Dunsmore, C&C group chief executive, said: 'Economic conditions in the group's core markets of Ireland and the UK remain unpredictable and challenging. Consequently, we are appropriately cautious in our outlook.

'Despite the challenges, we are pleased to report the continued growth of the cider category in the UK and the return to modest volume growth for the Magners brand for the first time since 2007.'

C&C also sells Bulmers in Ireland and recently snapped up Tennent's beer and the Gaymers Cider Company.

Half-year sales volumes of Magners worldwide rose 1.6% year-on-year, as the resurgent British performance and a 34% surge in exports offset falls in Northern Ireland.

Bulmers sales fell 3.4% in a difficult Irish market, where consumer spending has been hit hard.

But earnings have been boosted by cost cutting across the group, which it said was behind a 13% rise in UK operating profits.

And Mr Dunsmore confirmed C&C was on track to return to annual earnings growth this financial year, with the market expecting operating profits of between €102m and €106m (£88.9m to £92.4m).