Broker snap: A.G. Barr an 'add' on strong half-way figures, says Investec

23rd Sep 2013 09:33

Soft drinks maker A.G. Barr reported a strong first half as sales benefitted from a hot summer despite a fiercely competitive market, Investec said.The broker also noted the company's completion of a new production facility at Milton Keynes, which is expected to bolster growth in the second half. Profit on ordinary activities before tax and exceptional items increased by 12.3% to £16.6m in the six months ended July 28th, compared to £14.8m the prior year.Total turnover jumped 5.8% to £128.7m from £121.6m as customers stocked up on soft drinks to quench their thirst during the hot months.The company, which produces IRN-BRU, Rubicon and Strathmore water, grew its market share by 4.5% and raised its interim dividend by 8% to 2.825p from last year's 2.616p due to a positive outlook."We leave full year [FY] forecasts unchanged as the group faces some tougher revenue competition in the second half, but FY numbers still show +7% for profit before tax year-on-year," Investec said."We make no changes to our target price [585p] and our recommendation remains 'add'," Investec said.Shares rose 1.9% to 535p at 10:10 on Monday.RD