£20m windfall for shareholders as Liverpool city region Vimto maker Nichols reports an 18% rise in half-year pre-tax profits. Tony McDonough reports
Soft drinks business Nichols will pay a ‘special dividend’ to its shareholders totalling £20m after a big rise in half-year profits.
Merseyside-based Nichols, which sells the famous Vimto brand in more than 60 countries around the world, said adjusted pre-tax profits for the six months to June 30 came in at £14.5m, 18% higher than the same period in 2023.
Overall revenues at the stock market-listed business were actually down slightly from £85.5m last year to £84m. However, this was mainly down to exiting unprofitable accounts in its out-of-home division which supplies its products to hospitality outlets.
Headquartered in Newton-le-Willows Nichols is also behind the SLUSH PUPPiE Feel Good, Starslush, ICEE, Levi Roots and Sunkist soft drink brands.
Vimto is particularly popular in the Muslim world during the holy month of Ramadan. It provides a quick boost of sugar-filled energy following the dawn ’til dusk fast.
Its UK packaged business, where it sells to major retailers and wholesalers, saw a 5.3% rise in revenues to £45.4m. International packaged revenues fell 6.9% to £20m.
This was mainly due to the timing of Ramadan in the Middle East and the “strong comparator” as a result of significant launch volumes into Ivory Coast during the first half of 2023.
In recent weeks Nichols has launched its biggest-ever UK promotional campaign. Called Love the Taste, the business is confident it will lead to a surge in the Vimto brand over the summer.
Despite consumer spending remaining under pressure and costs significantly higher than two years ago, Nichols says it is enjoying “strong momentum” into the second half of the year and now expects full-year profits to be ahead of current market expectations.
Chief executive Andrew Milne said: “We are pleased to announce a special dividend of 54.8p per share – which equates to a total of £20m – alongside an 18% increase in the interim dividend to 14.9p per share.
“This reflects a long history of strong cash flow generation and the board’s commitment to delivering attractive shareholder returns.
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“Our biggest ever UK promotional campaign was launched towards the end of the Period, and we are confident this will support the continued growth of the Vimto brand over the summer.
“We now expect full-year profitability to be slightly ahead of current market expectations and we remain confident that Nichols is well placed to deliver its strategic growth ambitions.”