Irn-bru maker A.G. Barr flagged a hit to its second-half margins today (27), hurt by reduced consumer confidence and increase in costs, after reporting a rise in first-half profit due to continued demand for drinks during summer and a recovery in demand for its out-of-home products.
The drinks maker is now navigating a rise in input costs and lower consumer spending amid a rising inflationary environment in the UK, which it expects to continue through the year.
Chief executive officer of A.G. Barr Roger White reflected on the rising inflationary environment within the UK and said, “We anticipate in the coming months that the current economic environment will impact consumer purchasing behaviour, however, we currently remain confident that our strategy and actions will allow us to deliver a full-year profit performance ahead of the prior year.”
The Irn-Bru maker said trading was boosted by the warm summer weather and revenue in the first six months to July 31, 2022, fizzed upwards by 17% compared to the same period in 2021. The company took in £157.9m in the first six months of 2022 compared to £135.3m for the first half of the previous year.
In the interim results, AG Barr reported a rise in first-half profit but as a consequence of the inflationary environment, the company took a hit to its second-half margins. The Scottish company is initiating mitigating actions that management hope will still return an improved profit for the full year.