Fever-Tree provides trading update as pubs reopen

© Reuters

By Samuel Indyk – Fever-Tree has provided a trading update for the first four months of the year, where many pubs and bars were closed for the majority of the period.

The AIM-listed company said off-trade performance remained strong as at-home consumption of long mixed drinks is becoming increasingly established.

In the UK, Fever-Tree (LON:) said sales in the 13 weeks to 18th April were up 10.1% YoY, despite lapping the effects of stockpiling seen during the first UK lockdown in March 2020.

The supplier of carbonated mixers says it is too early to predict the pace of the recovery this year as pubs and bars begin to reopen. On April 12th, venues opened their outdoor space and from 17th May could open their doors inside and the company says it is well positioned to take advantage of this channel, which represented about 50% of UK revenue before the pandemic.

In the US, Fever-Tree said supermarket sales were up 38.2% from the same period in 2020. In Europe, Fever-Tree said off-trade sales have been “encouraging”, while for the rest of the world, Canadian and Australian sales appear positive.

Looking forward, it seems to difficult to predict whether the changes to at-home drinking brought on by the pandemic will last or whether drinking habits will revert back to normal as socialising resumes.

“The group seems to think the pandemic’s triggered a longer-term shift in at-home consumption of its higher end mixers,” said Hargreaves Lansdown equity analyst Sophie Lund-Yates.

“Given the tough job ahead of keeping sales moving at the heady rate expected by the market, this would certainly be a bonus.

“But whether this turns out to be true remains to be seen, somehow we suspect this tailwind may blow a little more softly than expected when the reality of normal life resumes.”

At 10:08BST, shares in Fever-Tree were trading higher by 1% at 2,590.7 pence per share.

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