Beverage group C&C said revenue fell 56% year-over-year amid the ongoing coronavirus pandemic, with restrictions aimed at curbing the spread of the virus causing trading to close on key markets.
The group said on Wednesday it was planning a rights issue to raise more than £ 150million, the proceeds of which would be used to reduce the group’s leverage and manage short-term business uncertainty.
The owner of Bulmers said net sales were € 736.9 million in the year ended February 28, 2021, with an operating loss of € 59.6 million. The UK market was down 36.4 percent to 206.8 million euros, while the Irish market was down 26.6 percent to 166.1 million euros.
The group’s non-commerce grew by 14.2% for the year.
The pandemic has also seen exceptional charges incurred, including impairment of equity-accounted investments, costs of write-offs of shares, costs related to waivers of restrictive covenants and other costs directly related to the pandemic.
Restructuring costs were partially offset by the profit from the disposal of a non-core asset.
The group negotiated temporary extensions of supplier payment terms and agreed on temporary deferrals with the British and Irish tax authorities for an amount of 77.4 million euros at the end of February 2021. More than 38.6 million euros are payable in the first half of fiscal 2022.
The group also completed a US private placement of 140 million euros in March 2020 and extended the repayment period of a 105 million euros term loan.
C&C Group Managing Director David Forde said the year had presented an extraordinary set of circumstances that had challenged his business and industry.
“With around 80 percent of C&C net revenue before Covid-19 coming from the hospitality industry, the pandemic has had an unprecedented impact on the group,” he said. “Our business model proved successful in fiscal 2021 as, during times of easing trade restrictions, we reverted to profit and cash generation. The strength of the C&C brand has been demonstrated by the increase in the share of our core non-commerce brands, reflecting their special relationship with the consumers they serve.
“We will build on this as the hospitality industry reopens, targeting growth in cider’s share and increasing our share in premium beer which we continue to see as a significant market opportunity.” . The development and evolution of our brand portfolio will remain essential for growth and we will strengthen our broader portfolio with new branches or actions for growth brands. “
C&C said it returned to profitability and the underlying cash generation as trading restrictions were relaxed in July, August and September 2020.
“We are confident in our business model and our growth strategy, the group continues to face uncertainty with the continued impact of COVID-19 in the hospitality industry,” said Forde. “Today we also announced a rights issue to generate gross proceeds of approximately £ 151million, which will strengthen the balance sheet and ensure C&C is in a stronger position to achieve sustained growth and pursue its strategy then that the hospitality sector emerges from the pandemic. ”
He said the group is looking ahead to the new fiscal year with optimism.