Magners maker C&C loses £6.2m a month amid lockdown

Magners and Bulmers cider maker C&C has revealed it is losing seven million euros (£6.2 million) a month while pubs and restaurants are closed amid the coronavirus crisis.

The Irish group said this was after around five million euros (£4.5 million) a month in support for furloughed employees, with around 70% of its staff retained under these schemes.

C&C said it had made no sales through pubs and restaurants since lockdowns came into effect across the UK and Ireland, but was focusing efforts on switching to sales through retailers and off-licences in the so-called off-trade market instead.

Total sales by volume of Magners in Britain slumped 7% in April and May, but it enjoyed a 25% surge in the off-trade.

Its Bulmers Irish cider tipple saw total volumes tumble 16% in the past two months, though off-trade soared 62%.

Pubs and restaurants have remained shuttered across Ireland since mid March and late March in the UK and are not expected to open until early July in Britain to control the spread of the pandemic.

Stewart Gilliland, C&C Group interim executive chairman, said: “The ongoing closure of the hospitality sector has material implications for our business and earnings potential, with approximately 80% of our revenue derived from the on-trade channel.

“An emerging trend from this shutdown however has been an immediate shift in consumption dynamics, resulting in increased demand in the off-trade
channel.

“To capitalise on this behavioural shift, we have reallocated resources behind our take-home proposition.”

The details of lockdown trading came as it posted a 12.1% rise in pre-tax profits to 104.1 million euros (£92.8 million) for the year to February 29.

Net revenues for the year rose 7.8% to 1.7 billion euros (£1.5 billion).

In Britain, operating profits lifted 1.9% over the year to 43.5 million euros (£38.8 million).

But sales by volume dropped 2.4% for Magners and 2.7% for its Tennent’s lager range as it failed to match the performance from a year earlier, which was boosted by the sunny weather and football World Cup.

Total cider volumes across its brands fell 6.4% in Britain, it added.