Shares in Irn-Bru maker fizz on recovery hopes
A BULLISH update put the fizz back into Irn-Bru maker
AG Barr’s shares.
The Scottish drinks group was the top riser on the FTSE 350 after reporting 2019 profits will be just over £37m – at the upper end of the City’s estimates.
Although this is an 18pc fall on the previous year, it is less of a blow than the 20pc drop the company said was coming last July.
At the time, it said trading in the first half of 2019 had been hit by a cooler summer and lower-thanexpected sales after a bumper 2018, when new sugar tax-friendly recipes were promoted, along with widespread discounting, which were in demand during a months-long heatwave.
It is now taking action to reset the business, chief executive Roger White said.
This includes increasing prices to a more sustainable level and tackling lower sales of its Rockstar and Rubicon brands with three new drinks for the former and rejigging the recipe for the latter. John Moore, senior investment manager at Brewin Dolphin, said the figures ‘ should provide further reassurance to investors who were spooked by last year’s profits warning’.
Traders seemed soothed, with shares in the mid-cap firm jumping 15.3pc, or 83p, to 627p. The double-digit rise helped the
FTSE 250, which rose 0.6pc, or 129.39 points, to 21433.06. And London’s premier index, the
FTSE 100, climbed 0.9pc, or 68.64 points, to 7480.69 as markets worldwide rebounded following a plunge on Monday that was fuelled by fears of the rapidly spreading coronavirus.
Joshua Mahony, senior market analyst at spreadbetter IG, warned the recovery was fragile, with sentiment ‘always just one major headline away from falling back once more’.
There was more cheer for the payments group Finablr, which surged 6.6pc, or 5.95p, to 96.25p, after its currency exchange arm Travelex became fully operational again.
It had been almost a month since a cyber attack crippled its IT systems, hitting banks and supermarkets that used its services, and leaving Travelex counter staff resorting to using pen and paper to calculate sales.
But fellow mid-cap group, cyber security services provider Avast, plummeted 9pc, or 47.7p, to 481.8p, after brokers at Peel Hunt slapped a ‘sell’ rating on the stock, believing it is overvalued.
Virgin Money, aka the recently rebranded CYBG, added 4.3pc, or 7.05p, to close at 172.5p as its loan book bulked up in the first quarter, helped by strong lending to businesses while the mortgage market stalled slightly. But the events and publishing group
Euromoney lost 3.6pc, or 48p, to finish the day at 1290p after saying trading is ticking along in line with expectations – though it said the amount of available cash it had at the end of December was almost half that at the end of September.
Over-50s travel and insurance group Saga made gains after confirming it is on track to meet its annual profit target of up to £120m, despite a £4m one-off hit from Thomas Cook’s collapse.
It soared 7.6pc, or 3.18p, higher to 44.92p, as it said its insurance business was doing better amid an overhaul, and that escorted tour packages are selling well.
Over on the AIM index, the podcast maker Audioboom climbed by 2.5pc, or 5p, to 205p after it added three new programmes to its slate.
The original podcast production arm of the group, backed by property investor Nick Candy, will air ‘Truth vs Hollywood’, ‘Life’s Little Mysteries’ and ‘ The Sitch with Mike and Lauren’ this year.