In our research released on 12 December 2014, we presented a negative observation relating to UK producers of cider, with particular attention to C&C Group plc [CCR LN]. Our sector data for October showed yoy sales dropping 14.3%, a trend continued into November when yoy sales dropped 14.0%. These sector figures were driven largely by declining volumes over the same period.
As a result, there is little surprise relating to C&C’s trading update relating to the period 1 September 2014 through to 14 January 2015, in which the company announced reduced full year EBIT expectations (down to 115m euros as opposed to previous consensus expectations of 127m euros), with much of this being attributed to reduced volumes across regions.
The stock dropped 5.95% over the course of the day. The drop in volumes in the sector has been precipitous and highly correlated to C&C guidance – consequently, we are highly interested in QMG data insights on this sector in coming months.