Fever-Tree's H1 revenue jumps 69%

By Erin Smith

Published: 26 July, 2016

Fever-Tree continues to grow on the back of the current gin boom that has been sweeping the UK with revenue up 69% according to interim H1 results out today.

The results cover the first half of the year to the end of June (30 June 2016).

The premium mixer company saw revenue increase to £40.6m.

"We are delighted to report that the Group's strong performance throughout 2015 has continued into the first half of 2016. Growth has continued to come from all of our regions as evidenced by further distribution gains in both the on and fff-Trade, as well as continued underlying sales growth.

The results have been well received by City investors.

Joshua Raymond, market analyst and FX broker at XTB.com said: "Fever-Tree reported a solid half-year trading update which should satisfy most investors, with a 69% growth in revenues to £40.6m, backed by a jump gross profit margins from 50.5% to 54.8%. There isn't much not to like in this update, with growth in revenues driven by strong sales which has been supported by distribution gains in both on and off-trade. That helped the supplier of premium carbonated mixers to report a 72% growth in adjusted earnings to £12.4m."

The UK market has played a significant role in the company's growth. Raymond said: "Growth in UK sales has been a key driver behind the firms strong performance, with UK sales more than doubling to 15.8m and contributing to 39% of total revenues, when a year ago that figure was closer to 31.5%."

The on-trade was where the company first gained traction and still the dominate channel for the mixers. "Growth in UK sales has been a key driver behind the firms strong performance, with UK sales more than doubling to 15.8m and contributing to 39% of total revenues, when a year ago that figure was closer to 31.5%," said Raymond.

While on-trade is where the company first gained traction the off-trade has proven to be particularly active channel for the company as consumers look to treat themselves at home with more premium products. The addition of new distributors in the off-trade has also helped to further expand Fever-Tree's reach. "Off-Trade performance however was the standout, thanks to the launch of 150ml cans and a distribution deal with Asda. It is here where there continues to be strong potential, though the firm will now move to dampen expectations on maintaining the sort of growth path it has enjoyed in the last year and a half with off-trade," said Raymond.

Fever-Tree is looking at potentially complementing future growth by expanding to new territories. The company appointed new importers in both Spain and Netherland.

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