C&C’s share price had fallen by over 12% at one point in early trading, but has since recovered somewhat and currently stands 7.6% down on the day so far.
Despite net revenue increasing 9.3% to €368.1m, operating profit fell 2.7%, to €69.2m, earnings before interest, tax, depreciation and amortistion (EBITDA) dipped 2.2%, to €81m, and and free cash flow tumbled 48.4% to €30.8m.
C&C says that earnings growth in its core Ireland and Scotland businesses was offset by “challenges” in both the US, where performance was described as “disappointing“, and England & Wales, where the company says that “heightened competition” reduced the contribution from its cider portfolio.
Basic earnings per share (EPS) were up 22.4%, to 15.3 cents, and the board is recommending an interim dividend of 4.5 cents per share — an increase of 4.7% year-on-year, which the company says reflects its “strong balance sheet, underlying cash generation capability and commitment to deliver value for shareholders“.
C&C says that its first-half performance is “solid” when considered against prior year comparisons in Ireland, the fact it’s still in the early stages of its US marketing investment programme, and a trading environment in England & Wales that it describes “intensively competitive“.
Last week C&C confirmed that it had made a preliminary approach to the Spirit Pub Company, which operates pub & restaurant brands such as Chef & Brewer, Fayre & Square and Flaming Grill. Spirit rejected the approach, and C&C now has until 5pm on 20 November to announce whether or not it has a definite intention to make a formal bid.
Under the takeover code, because its interest in Spirit remains to be settled either way, C&C is prevented from issuing new operating profit guidance.
Commenting on the results, group CEO Stephen Glancey said
“The strength of our core business in Ireland & Scotland underpinned profit delivery of €69.2m in the period. Given the lower than expected contribution from the US and England & Wales businesses, this is a solid outcome.“
C&C’s share price has now fallen over 14% since it confirmed its interest in the Spirit Pub Company just five days ago.
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Jon Wallis has no position in any shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.