The price of shares in AIM-listed beverages firm Fevertree Drinks (LON:FEVR) rose 3.35% to 2,191p (as of 16:00 BST) despite the company reporting an 11% drop in global revenues for the six months ended 30th June. While off-trade sales saw significant growth, the collapse of on-trade business due to COVID meant that overall sales fell sharply in the UK and Europe. Gross profit margins were also down due to the shift in channel mix and more aggressive US pricing.
CEO Tim Warrillow commented: “I am very proud of how the Fever-Tree team has responded over the last six months and the results that we have delivered. Our priority throughout the COVID-19 pandemic has been our close-knit team, who are integral to the success of the business. We did not furlough any team members and instead focused on redeploying talent around the business. We have also continued to invest in building the team across the globe, adding 20 new employees in the first half of the year.
“Our performance in the Off-Trade over the first half of the year has been very encouraging with sales across our regions exceeding our expectations. People’s interest and excitement about mixing drinks at home has really taken hold over the lockdown period, attracting more households to the Fever-Tree brand than ever before. Consequently, we have increased our penetration in the UK, consolidated our number one position, and driven value share gains in the US, Europe, and as far afield as Canada and Australia. Despite the On-Trade closure for a large proportion of the first half of the year, we have continued to support our On-Trade partners across our regions and are well-placed to benefit from the return of this important channel.
“We have had an encouraging start to the second half of the year and, while we certainly aren’t immune to the ongoing challenges of COVID-19, our performance and our investments so far this year, coupled with the growing interest in long mixed drinks, gives me confidence that we will exit the crisis in an even stronger position than we entered it“.