Global expansion sees Vimto sales rise

Aug 7 2008 by Alex Turner, Liverpool Daily Post

VIMTO producer Nichols has reported rising sales and profits, despite a less than sparkling performance from its Panda brand.

Sales for the Newton-le-Willows-based soft drinks group increased 5% to £29.2m in the six months to June 30, with profits ahead 15.5% at £3.2m.

But the group, which employs more than 150 people, said a decline in the kids’ fizzy drinks market and a reduction in selling space after multiple retailers moved from selling single bottles to multi-packs had affected Panda’s result.

Nichols said it was reviewing its multi-pack options for Panda, but said this was unlikely to mitigate the volume decline in the current year.

However, its core brand, Vimto, continued to grow its market share, with the drink now available in more than 65 countries. It performed strongly in the Middle East, which the group attributed to the earlier timing of Ramadan.

Nichols said the period saw it contend with challenging market conditions, heavy promotional activity and rising costs.

However, chairman John Nichols said he was optimistic the company, which is celebrating its centenary, was taking the right steps to offset the uncertain conditions.

He said: “The economic uncertainty is obviously set to continue, and at this stage we can see no real signs of improvement. However, we remain optimistic but cautious we are doing the right things in a very tough market.

“We believe our core brand of Vimto will continue to perform well despite difficult market conditions and we anticipate both organic and new market growth internationally.

“In overall terms, we therefore expect the group to show further, solid progress in the full year.”

The company’s other division supplies over 5,000 outlets in the licensed trade, leisure and catering markets with soft drinks on draught.

It trades under the Cabana, Beacon and Cariel brands.

Revenues for its dispense division increased 4%, with profits described as being at “acceptable levels”. Nichols began life with the creation of Vimto, a fruit-flavoured cordial, by John Noel Nichols, in Manchester, in 1908. It was developed as a health tonic and became popular during the temperance movement.

alex.turner