Fever-Tree has published a strong set of financials for the first half of the year with the company’s European revenue growing by 102 per cent.
Total revenue surged by 36 per cent to £141.8m in H1 2021, up from £104.2m in 2020. The European market saw the strongest growth with intake doubling from £20.5m to £41.3m, while UK sales stayed flat at £50m.
Shareholders were treated to a healthy payout of 17.44 pence per share, a jump of 17 per cent year on year.
Tim Warrillow, the CEO of Fever-Tree, said he was “pleased” to report “excellent sales” for the first half which have helped the brand to grow its “ambition and confidence” in worldwide markets.
“We have been encouraged by the initial re-opening of the On-Trade, the ongoing strength of the Off-Trade with sales exceeding pre-Covid levels across all our regions, as well as the response to our new product launches, all of which is a testament to our increasing brand strength” he said.
Despite the strong set of financials gross margins were “significantly” diluted by on-going global logistics disruption and cost pressures, contributing to a 270bps reduction for the first half of the year.
Fever-Tree has six bottling factories in the US, with two due to open this year, which has caused supply disruption as a result of elevated trans-Atlantic freight charges and storage costs. Supply chain issues are choking businesses worldwide with the challenges expected to continue into FY22.
Chris Daly, CEO of the Chartered Institute of Marketing commented on the results saying, “a rise in drinking during lockdown, and the gradual reopening of hospitality has kept Fever-Tree’s sales positive in early 2021.”
“The drinks mixer isn’t completely out of the woods,” Daly cautioned. “With supply chain issues likely to continue indefinitely, Fever-Tree will need to keep an open line of communication on any future challenges or otherwise risk losing its loyal customer base.”
Despite the challenges ahead Fever-Tree reiterated its increased revenue guidance of £295m – £304m for the full year. Share price has jumped by 1.4 per cent today.