Merseyside-based maker of Vimto, Nichols, sees the coronavirus crisis hit half-year revenues and profits but says its key Middle East market remained ‘resilient’. Tony McDonough reports
Vimto maker Nichols has felt the impact of the coronavirus lockdown with big falls in half-year revenues and profits.
The Merseyside soft drinks firm has also announced that chief executive Marnie Millard will step down from her role on December 31 and will be succeeded by current chief operating office Andrew Milne.
For the six months to June 30 Newton-le-Willows-based Nichols saw revenue fall by 17.3% to £59.2m and pre-tax profits plummet 78.2% to £2.9m. As well as the effects of the lockdown the business was also hit by the introduction of a sweetened beverage tax in the Middle East, one of its biggest markets.
Vimto is heavily consumed in the Middle East, particularly during the holy month of Ramadan. During the period Muslims fast from dawn until sunset and Vimto provides a quick boost of sugar-filled energy during the evening.
Nichols says the the Vimto brand was “resilient” throughout Ramadan, which this year was from April 23 to May 23. Sales across its international markets were £13.3m, a decrease of 8.1% and helped by an 8.7% rise in sales in Africa to £8.3m.
In the interim report, executive chairman John Nichols said cash balances had grown strongly to £46.8m as management took “prudent steps” to conserve cash throughout the second quarter of 2020 in response to COVID-19.
He added: “Our first and most important objective through this unprecedented period has been the protection and wellbeing of our employees and customers. Throughout these most difficult of times, our colleagues have once again demonstrated their values and commitment.
“In light of the ongoing impact to the financial results of the group due to the global pandemic, the board remains pleased with the group’s performance. Although the immediate future remains uncertain, we are confident in Nichols’ ability to emerge from this period well-placed to continue to deliver the group’s long-term strategic plan.
“On behalf of the board I would like to thank Marnie for her significant contribution to the group over the last seven years and wish Andrew every success in leading the business during the next phase of its development.”