Fever-Tree mitigates cost pressures as inflation soars

Fever-Tree has revealed it aims to mitigate cost pressures following the inflation costs.

According to the drinks giant, despite uncertainty remains in the near term, it is  working with its supply chain partners on a large number of initiatives, including the ramping up of US East Coast production.

This comes as the group revealed its expectations are “in line” with the boards expectations for the full year to 31 December 2022, as set out in March.

It predicts a revenue range of £355 million to £365 million and an EBITDA range of £63 million to £66 million.

READ MORE: Fever-Tree fizzes on back of strong supermarket sales

However, in the UK, UK Off-Trade, in the first few months of the year the category has continued to rebalance as the On-Trade re-emerges whilst also coming back from the Covid-19 lockdowns.

It also claims it “remains well placed” as it prepares for the summer months, most notably around the Platinum Jubilee celebrations in early June.

Fever-Tree also revealed plans to expand its product portfolio over the next 19 months, following the launch of its Limited-Edition Passionfruit & Lime Tonic in the UK.

“Fever-Tree has delivered a solid start to the year, significantly aided by the re-opening of pubs and restaurants in the on-trade and the UK’s gradual recovery following the Covid-19 pandemic,” Patrick Higgins, equity analyst at Goodbody said.

“The boom of in-home consumption exhibited during the multiple lockdowns was also sustained, and off-trade growth was particularly strong in Europe and the US.

He added: Looking forward, while the Group is well positioned to drive top-line momentum, it has several challenges to navigate in terms including significant inflationary pressures and supply chain disruptions.

“This will likely weigh on profit growth in the near term though we continue to believe the brand is well positioned to grow over the medium term giving its market leading position in the structurally attractive premium mixer category.”

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