Nichols revenue rises as it shifts to concentrate model
By Josh White
Date: Wednesday 23 Apr 2025
(Sharecast News) - Nichols reported a 1.2% year-on-year increase in group revenue to £39.3m for the first quarter of 2025 on Wednesday, in line with board expectations.
The AIM-traded soft drinks company reiterated its full-year revenue and adjusted profit guidance, citing confidence in its strategy and the strength of its balance sheet.
It said UK packaged revenues rose 4.0% to £21.3m, supported by further distribution gains and underlying volume growth for the Vimto brand.
International packaged revenue declined 7.6% to £9m, reflecting the timing of Ramadan-related shipments in the Middle East and the group's strategic transition to a higher-margin concentrate sales model in West Africa.
Nichols maintained its outlook for profitable growth in the International segment over the full year.
Out-of-home revenue increased 4.6% to £9m, driven by a focused business development effort and the execution of changes following the segment's 2023 strategic review.
The company reported net cash of £60m at the end of the period, up from £53.7m at year-end 2024, providing ample financial flexibility to support its medium-term growth ambitions.
Nichols said it was monitoring the global trade environment following recent tariff changes announced by the US, but noted that exposure to directly affected markets was limited, accounting for less than 2% of revenue.
The group also highlighted contractual protections that offered near-term stability against input cost inflation.
With a diversified business model, strong brand equity in Vimto, and a clear strategic roadmap, Nichols said it remained well positioned to deliver continued profitable growth in the current financial year.
"We are pleased to have delivered further strategic progress in the first quarter," said chief executive officer Andrew Milne.
"Our UK packaged business delivered continued growth as a result of increased volumes and distribution gains, reflecting progress against the strategic priorities outlined at our 2024 CMD.
"In the international business, we are making good progress with the shift towards a higher margin concentrate model in several of our West African markets."
Milne said that while the move away from shipping finished products impacted revenue, the concentrate model delivered a "step change" in margins, and positioned the company well to achieve long-term, profitable growth in these markets.
"We continue to expect further growth in 2025 in line with market expectations as we continue to execute our strategy and make progress towards our medium-term financial and strategic ambitions."
At 0907 BST, shares in Nichols were down 2.01% at 1,180.8p.
Reporting by Josh White for Sharecast.com.
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