Nichols PLC on Wednesday said it expects profit for 2024 to be in line with market expectations, as ‘positive momentum’ continued in the second half.

The Lancashire, England-based soft drinks maker expects to report that revenue increased by 0.8% to £172.1 million in 2024 from £170.7 million in 2023. Revenue consensus stands at £172.7 million, the Vimto maker said.

Nichols predicts adjusted pretax profit in line with market expectations of £30.1 million. This would represent a rise of 11% from £27.2 million in 2023.

‘The group delivered another strong performance in 2024,’ Nichols said.

‘We continued to perform well within our Packaged business, with full year sales up by 3.8%, driven by particularly strong growth in the UK where sales rose by 5.4% largely driven by innovation and distribution gains. The International business performed very strongly in the second half, as anticipated, with full year revenues remaining in line with the prior year, despite the shift to a lower revenue but margin enhancing concentrate model across several African markets. In line with the group’s expectations, Out of Home revenue reduced by 8.2% following exits from unprofitable accounts as part of the actions following the 2022 strategic review.’

Nichols said its gross margins ‘have continued to improve’ as inflationary pressure abates.

It added: ‘Whilst inflationary pressures now appear to be moderating in the UK, the board remains mindful of continued uncertainty affecting some of the group’s markets and necessary mitigating actions are in place. Underpinned by the strength of its diversified business model and robust financial position, the group remains confident that Nichols is well positioned to deliver its strategic plans and medium-term financial ambitions that will continue to generate sustainable shareholder returns.’

Back in November, Nichols set out a medium-term aim to achieve annual revenue of £225 million, as well as pretax profit of £45 million.

‘The delivery of the strategy and financial ambitions are underpinned by a strong balance sheet, and a disciplined capital allocation framework focused on enhancing shareholder value,’ it said at a capital markets day.

‘The group’s strategy aims to create shareholder value by building a high-margin, highly cash-generative, diversified business, leveraging the strength of the differentiated Vimto brand.’

Nichols shares traded 0.1% lower at 1,263.40 pence each in London on Wednesday morning.

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