LONDON (ShareCast) - Nichols shares were hit after the High Court ruled that the soft drinks company must pay the equivalent of £8.0m in damages, in addition to costs in the range of £1m-1.5m, following a litigation claim from Gul Bottlers.

The amount is significantly above the £2m that the company had set aside for the claim.

The size of the award is based on the court's assessment of Gul's loss of profit for the duration of a contract signed in September 2011 to produce and distribute Vimto in the Pakistani market.

Nichols issued a statement which said it "fundamentally disagrees" with the quantum of the award and this it was "considering with its professional advisers options for appeal".

"Whilst this is an extremely disappointing outcome, there is no impact on future underlying trading expectations and the payment of this award in no way affects the group's ability to continue with its strategy to invest in its brands and future growth plans," the firm said. "The group continues to be highly cash generative with a strong balance sheet."

It confirmed that trading for the first six months of the year had continued to be good and the group said it was confident of delivering full year results in line with management expectations.

The share price had fallen 7.48% to 884p by 14:56.

NR

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