C&C Group issues profit warning after ‘softer than anticipated demand’

Drinks firm C&C Group, which produces brands including Tennent’s beer and Bulmers cider, has issued a profit warning in the face of “below expectations” trading.

The group reported that customer performance across November and early December was “impacted by weak consumer confidence associated with the November UK Budget”.

As a result, C&C now expects adjusted operating profit to be in the range of €70m-€73m (£60.9m-£63.5m), reflecting lower operating profits in its distribution business.

It anticipates that FY27 profits will be similar to the current year, reflecting the impact of planned reductions in volumes through the distribution channel as less profitable business is exited, but the lag between revenue decrease and cost reduction initiatives is expected to lead to short-term profit dilution.

In its previous financial year to 28 February 2025, the group posted a net operating profit of €45.8m (£38.4m), compared to an €84.4m (£70.8m) loss the previous year.

During the latest period, business performance was driven by “softer than anticipated demand in hospitality”, alongside adverse product mix, as consumers continue to move away from the consumption of wine and spirits in favour of beer across the market.

However, trading across the Christmas fortnight was in line with expectations, with Tennent’s and Bulmers performing strongly.

In January, C&C Group has seen continued softness of consumer demand and anticipates this will continue for the financial year.

The group said it had continued to make strong progress in its objectives around improving customer service, developing brand execution, innovation and operational efficiency, but these were not sufficient to offset the combination of subdued market volumes, unfavourable category mix and competitive pricing dynamics.

C&C Group previously discovered “accounting mistakes and errors” in its results from 2021-2023.

Its former chief executive Patrick McMahon stepped down in June 2024 after the errors were discovered.

Roger White took over as group chief executive officer in December 2024.