Irn-Bru maker AG Barr buys health shots firm for £15m after selling Scottish business
“I am also excited about our expansion into the functional beverage segment” – Euan Sutherland, chief executive
Irn-Bru maker AG Barr has spent £15 million snapping up a majority stake in a top brand in the “functional shots” market after concluding the sale of the Strathmore bottled water business.
The iconic soft drinks maker said it had acquired a 50.1 per cent equity stake in Innate-Essence, the home of The Turmeric Co, which is also behind a number of other speciality health drinks.
Bosses said the move was consistent with the company’s strategy of targeting “acquisitions and innovation in high growth, health focused, functional beverage categories”. The deal has been funded from the group’s cash funds. It is not expected to have a significant impact on revenue or profit in the current financial year, Barr added.
The firm has also concluded the sale of the Strathmore brand and the Forfar production site to Tŷ Nant, ”negatively impacting” revenue in the short-term but not profit. In March, Barr announced plans to “discontinue” its Strathmore bottled water brand and seek a potential buyer.
News of the Innate-Essence acquisition came as Cumbernauld-headquartered Barr issued a trading update, revealing that first-half revenue is expected to be in the region of £228m, up about 3 per cent on the year before. Overall, trading momentum increased as the first half progressed, with several record volume weeks in the second quarter.
Brand revenue performance was led by Boost which delivered strong double-digit growth. Irn-Bru and Rubicon were flat in the half-year period, with a stronger performance in Q2.
The group’s revenue and profit growth expectations for the full year are unchanged.
Chief executive Euan Sutherland told investors: “We are pleased to report continued revenue growth and strong profit growth in the first half of the financial year.
“Trading improved during H1 [first half] and we enter H2 with strong momentum and continued progress on margin improvement as our strategic initiatives continue to deliver. I am also excited about our expansion into the functional beverage segment working alongside Thomas Robson-Kanu and the Innate-Essence team. Our full year guidance remains unchanged and in line with market expectations.”
Comments
Want to join the conversation? Please or to comment on this article.