How to profit from the British firm selling ice cream to the Italians
...and Scotch to the Mexicans!
WALL’S ice cream, Johnnie Walker whisky and Jordans Country Crisp breakfast cereal are enjoyed by millions of people in the UK.
But did you know that these British products are becoming staples in homes across the world?
Bedfordshire-based Jordans, for example, is the second biggestselling cereal brand in France, while Johnnie Walker owner Diageo is enjoying booming sales of whisky in countries such as Mexico.
These firms are at the cutting edge of the type of cross-border trade everyone is hoping for once Britain leaves the EU.
Firms such as Pladis, the owner of McVitie’s biscuits, are keen to cash in on Britain’s reputation for quality goods by introducing them to the rest of the world.
Its owners, who have their headquarters in Turkey, have said they want to boost sales of favourites such as Digestives and Jaffa Cakes — many of which are made in Britain — by 50pc over two years by shipping more overseas. So, how do investors cash in? Jordans is a British success story. It began as a family flour mill in Biggleswade, near Bedford, in the 19th century.
One of the family discovered granola in America in 1968 and brought the idea to Britain.
Today, Jordans cereals can be found on shelves in more than 60 countries, the company having grown exports by more than 60pc to £90million over five years.
Its granola and muesli are popular in health-conscious countries such as France, Canada and Australia, where it sells to one in ten households.
Jordans sells almost as much cereal internationally as it does in Britain.
The 162-year-old firm’s parent company, Associated British Foods, made a £1billion profit last year and its share price is up 40 pc in four years.
Darius McDermott, of fund broker Chelsea Financial Services, recommends BlackRock European Absolute Alpha to savers wanting to share in the firm’s success.
The fund invests £1.30 of every £100 in Associated British Foods and has turned £10,000 into £11,270 over five years.
Whisky accounts for £4billion of the goods shipped abroad from Britain each year, with 1.2 billion bottles exported.
America and France account for just under a third of total exports. In France, whisky sales outstrip the domestically produced spirit cognac.
Whisky is becoming increasingly popular among younger people in emerging economies, who see it as a status symbol. In Mexico, it’s giving local favourites tequila and mescal a run for their money.
The Scotch Whisky Association says the number of bottles shipped to Mexico grew by a third to 57.1 million between 2014 and 2015. The country’s favourite brand is Johnnie Walker, owned by Diageo.
The London-based firm, the world’s biggest producer of spirits, reported sales of £600million in Latin America and the Caribbean last year.
Jason Hollands, of fund broker Tilney, tips Evenlode Income, which invests £7.40 of every £100 of savers’ money in Diageo. It has turned £10,000 into £19,720 in five years.
Italy is proclaimed as the home of ice cream, each year exporting more than £190 million worth.
But Britain isn’t far behind, with annual exports totalling £105 million. And 5pc of this goes to Italy.
British-owned Unilever, which owns brands such as Marmite and PG Tips, is the world’s biggest maker of ice creams.
Four big brands sold in Italy — Cornetto, Carte D’Or, Max and Magnum — come under the umbrella of Heartbrand, whose distinctive heart logo is used in more than 40 countries.
The brand we know as Wall’s is sold under different names throughout the world; it’s called Algida in Italy and Eskimo in Austria, for instance.
Wall’s was originally a butcher’s stall in St James’s Market in London, which sold sausages to the Royal Family before expanding its business into ice creams.
Last year, the division of Unilever that makes ice cream turned over £8.6 billion, 20 pc of the company’s total. It recorded profits of £900 million.
Ben Yearsley, of adviser Wealth Club, tips Liontrust Special Situations, which invests 4 pc of savers’ money in Unilever. The fund has turned £10,000 into £18,090 in five years. Foreign tourists have sometimes mocked our warm, flat ales — but they’re coming round to them. One of the best known brands is Newcastle Brown Ale, brewed in Yorkshire by the Dutch drinks giant Heineken. Newkie Brown, as it’s affectionately known, has become a cult classic among American hipsters since it arrived in the U.S. in the Eighties. It’s a favourite from New York to Los Angeles — film star Clint Eastwood is said to be a fan.
Heineken exports the equivalent of 43million bottles of Newkie Brown to the U.S. each year — roughly the same amount consumed in Britain.
For investors, Mr Yearsley tips Lindsell Train Global Equity, which invests more than £7.50 in every £100 in Heineken.
The fund has turned £10,000 into £24,270 in five years.