Merseyside Vimto maker Nichols said its expects profits for 2023 to be ahead of current market expectations of around £25.4m. Tony McDonough reports
Vimto maker Nichols says revenues for the year to December 31, 2023, are up 3.5% to £170.7m and it now expects pre-tax profits to be slightly above expectations.
Analysts had expected the pre-tax profit figure for the Newton-le-Willows-based businesses to come in at around £25.4m. A strong performance in the second half of the year has now caused an upward revision.
Nichols is now seeing improvement in its out-of-home (OOH) division which supplies its products to hospitality outlets such as cafes, bars and hotels as well as leisure venues, following a strategic review. Revenues are down as it exits unprofitable accounts.
Nichols sells Vimto and other soft drinks brands, including SLUSH PUPPiE Feel Good, Starslush, ICEE, Levi Roots and Sunkist, across the UK and more than 70 countries.
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.
In a trading update on Wednesday, Nichols said: “We continued to perform well within our packaged business, where sales were up by 6.1%, with progress particularly strong in international where export sales across the year were up by 16.8%.
“In line with the group’s expectations, revenue from our OOH business continued to reduce as we exited from unprofitable accounts.”
It added: “We are pleased that our gross margins have been largely maintained despite considerable inflationary pressures early in the year. This stability has allowed us to increase the level of investment in the long-term strategic development of the group.”
Nichols also announced the appointment of Matt Nichols to its board as a non-executive director. The Nichols family is entitled to two non-executive positions.
He joined the company in September 2006 and has held several senior roles. He currently holds the position of commercial director – international.
READ MORE: Langtree hails ‘strong’ performance despite fall in profits
READ MORE: Liverpool training provider secures £1.6m from Government
Chief executive Andrew Milne said: “Nichols has delivered a strong performance in FY23 making good progress against our strategic plans and achieving a profit before tax outcome ahead of market expectations.
“This is a great testament to the strength of the group’s business model and brands, with our established UK position complemented by strong momentum internationally.”