Fevertree’s annual profit dropped 29% after the Covid-19 crisis caused revenue to fall but the mixer-drinks maker increased its dividend.
Pretax profit fell to £51.6m from £72.5m in the year to the end of December as revenue fell 3% to £252.1m. Gross profit fell 12% to £116.3m.
On-trade sales at bars and restaurants, which normally make up 45% of sales, were hit hard by the Covid-19 crisis but retail and other off-trade sales exceeded expectations in all regions.
Fever Tree increased its final dividend to 10.27p a share from 9.88p taking the annual payout to 15.68p a share. The company said it expected revenue to increase by between 12% and 16% in 2021.
Tim Warrillow, Fever Tree’s chief executive, said: “Our performance in the off-trade was especially strong, exceeding our expectations across all our regions. Numerous periods of lockdown during the year encouraged increased consumer interest in premium spirits and stimulated excitement about mixing drinks at home, attracting more households and new consumers to the Fever-Tree brand than ever before.”
The company said it expected off-trade sales to stay strong despite some unwinding as lockdowns are eased and that momentum would build in on-sales as 2022 progresses.
Fevertree shares fell 9.8% to £22.90 at 10:13 GMT. The shares have more than doubled in the past year.
William Ryder, equity analyst at Hargreaves Lansdown, said: “Fevertree has had a tough year as lockdowns forced bars and restaurants to shut their doors for large chunks of the year.
“The market reaction may have disappointed some investors this morning, but this just goes to show how high expectations are and the risks of a demanding valuation. From a business perspective we think Fevertree has coped reasonably well over the last year.”