Fevertree Reports Growth in US Market Fuelled by Strong Sales

Fevertree has demonstrated a commendable financial performance, particularly in the United States, which has now surpassed the UK to become the company’s largest market by revenue. The upmarket tonic water manufacturer reported a 9 per cent increase in US sales, reaching £128 million for the year ending December 31. This growth has been attributed to the company’s successful expansion in both the tonic and ginger beer categories, capturing 27 per cent and 32 per cent of market share respectively.

The group’s total revenues for the year climbed to £368.5 million, reflecting a 3 per cent rise on a constant currency basis. However, UK sales saw a decline of 3 per cent, totalling £111.1 million. The dip has been linked to low consumer sentiment within the UK market and a downturn in the gin category, which has affected sales figures.

European sales also experienced a decrease, slipping 2 per cent to £92.7 million, while revenues from the rest of the world showed a promising 19 per cent increase, reaching £32.2 million. Notably, adjusted profits surged by 66 per cent to £50.7 million, demonstrating effective cost management and operational efficiency.

The strong performance in the US market has prompted Fevertree to extend its share buyback programme by an additional £29 million, with plans to return up to £100 million to shareholders this year. The company remains optimistic about the prospects of its UK market, as it expects a return to growth in the near future.

The partnership with Molson Coors, established earlier in the year, is anticipated to yield substantial benefits. The collaboration includes a significant financial investment from Molson Coors, which acquired an 8.5 per cent stake in Fevertree for £71 million. This agreement is expected to facilitate revenue growth and bolster profit margins as Fevertree further entrenchs its presence in the US.

With a strategic focus on expanding its portfolio, Fevertree has successfully positioned its non-tonic products to now account for approximately 45 per cent of global sales. The company’s chief executive Tim Warrillow emphasised that broadening its product range has been a key driver of growth and market competitiveness.