LONDON (ShareCast) - (Sharecast News) - Soft drinks maker Nichols reported a 19.1% improvement in group revenue in its interim results on Wednesday, to £80.2m.
The AIM-traded producer of brands including Vimto and Sunkist said its adjusted operating profit was 24.2% higher year-on-year for the six months ended 30 June, at £11.2m, although its profit before tax margin narrowed by 0.2 percentage points to 12.6%.

Adjusted earnings per share came in at 24.8p, up 27% on the prior year, while cash and cash equivalents fell 13.2% to stand at £49.2m at the period end.

The board declared an interim dividend of 12.4p per share, up 26.5% on the 9.8p distribution it made at the same point last year.

Nichols said its 2022 group expectations remained unchanged, noting "significant and accelerating" inflationary pressures, particularly in ingredient and packaging costs.

It said customer, supplier and operational mitigation actions were underway.

"I'm pleased to report an encouraging financial performance in the first half of the year with 27% increases to both adjusted profit before tax and the half-year dividend," said non-executive chairman John Nichols.

"In the UK, the Vimto brand continues to outperform the broader squash market, and the group's out-of-home route-to-market experienced good growth as the wider leisure sector continues to recover from the impact of the pandemic.

"After some disruption to shipments affecting our International business in the first quarter, I am pleased to report a recovery in the second quarter which has so far continued into the second half of the year."

John Nichols said that, while the group was not immune to the "significant and accelerating" inflationary pressures impacting the consumer and the soft drinks market, it had taken "swift" mitigating actions where possible, as its adjusted profit before tax expectations for the full year remained unchanged.

"The board remains mindful of the potential earnings impact of continued inflation into the 2023 financial year and beyond.

"We have a long-term track record of growth, a proven, diversified strategy, and a quality range of brands.

"All of this is underpinned by a strong balance sheet. As a result, the board remains confident that the group is well positioned to deliver its long-term growth plans."

At 1031 BST, shares in Nichols were down 5.68% at 1,245p.

Reporting by Josh White at Sharecast.com.

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