Fevertree sales build momentum

Fevertree Drinks (LON: FEVR) have trimmed rrofit forecasts, although Fevertree has reiterated its guidance of revenues between £390m and £405m.

The AIM-quoted mixer drinks supplier has improved UK sales marginally, but that is on the back of a 5% price rise, so volumes have fallen. The share is still higher than in the first quarter of 2020, though. Cost inflation remains a problem.

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US revenues and volumes grew in both the on-trade and off-trade. Europe and the rest of the world are growing, although Australia will have a tougher first half because of the change in distribution partner.

EBITDA guidance is maintained at between £36m and £42m, but the forecasts are moving towards the lower end of the range.  

The full year pre-tax profit forecast has been cut from £28m to £26.8m, down from £31m last year, which would mean that profit has more than halved over two years. The dividend forecast is still 16.9p a share, which is only just covered by forecast earnings.

The share price has slipped 1% to 1419.5p, but it is still nearly two-fifths higher than at the beginning of the year. The prospective 2023 multiple is 82, but that would fall below 50 for 2024 if the current forecasts are achieved.

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