AG Barr expects sales for 2009/10 to reach GBP220m, with profits also set to increase. The group has performed well despite difficult conditions in a category that continues to be maligned due to health concerns. Soft drinks remain affordable and occasional treats in the eyes of consumers, and this success further shows that companies in the sector can still prosper during recession.
Soft beverages firm AG Barr anticipates that sales for the year ended January 2010 will reach approximately GBP220m. This would represent a substantial increase of 20% on its revenues for 2008/09, while the company also expects profits to be ahead of market expectations. The soft drinks manufacturer owns the popular Irn-Bru and Tizer brands, among others, and has prospered despite the turbulent economic conditions that defined the past year.
Carbonated drinks have recently received much criticism from certain corners over their contribution to the obesity epidemic. Prolonged consumption has been linked to a range of ailments, including diabetes, and some people continue to campaign for these products to carry health warnings.
In light of such concerns, categories containing drinks that are perceived to be healthier, such as smoothies, have performed well in recent times. However, it would appear that the success of this subcategory has not been at the expense of carbonates. Consumers are finding room for both types of drinks in their lives, with carbonates seen as an occasional treat and healthier beverages being used to balance things out after over-indulging.
Nostalgia has become a very important trend during the recession, with many consumers seeking out brands that remind them of happier times from childhood. This has helped industries such as soft drinks and fast food to continue to post encouraging figures over the past two years of turmoil.
The success of AG Barr in 2009 is further evidence that money can still be made in this sector during recession. A soft drink still retains the status of an affordable indulgence that can be enjoyed in moderation, and this has resulted in gains for some companies operating in this field. The future remains unclear for the industry, but the positive figures posted by many companies in 2009 should provide encouragement for their peers once recovery gathers pace.