Forecasts cut after Taunton Cider alert

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The Independent Online
DRINKS analysts lowered profit forecasts for Taunton Cider after it warned that selling prices in the second half had been depressed by a 'substantial' marketing programme, writes John Shepherd.

Cost reductions are being implemented but there will still be an impact on profits. Turnover and operating profits are expected to be broadly in line with last year.

Analysts, who had predicted profits of pounds 21m to pounds 22m pre-tax for the year to May, have cut forecasts to around pounds 20m.

The impact on Taunton's shares, down 3p to 155p, was partly tempered by the company also announcing an agreement with Molson Breweries to distribute several of Taunton's leading brands in the US. Shipments are expected to begin in May.

Michael Cottrell, chairman, said Christmas sales were broadly in line with last year. Restocking in January, however, was slightly lower than normal due to increases in excise duty and industry prices.

The market had also become more competitive with economy brands continuing to increase volume.