The FT today has a piece on the Magners success story. The Clonmel cider plant is having difficulties keeping up with a monster 250% growth rate in Britain.
C&C said that capacity constraints meant it was “experiencing difficulties in meeting the full market demand for Magners, particularly in relation to take-home packs”.
The company said it planned on investing to increase its capacity before next summer. That would reduce its free cash flow/earnings before interest, tax, depreciation and amortisation to a 30-40 per cent range in 2006-7 and 2007-8, although it said its dividend policy would not be affected.
C&C predicted further strong growth for the Magners brand in the second half of the year. “This should lead to an acceleration in the rate of overall group operating profit growth for the second half of the 2006/07 year compared with the rate of growth in the half year to 31 August 2006.”