Shares in C&C Group PLC (LSE:CCR) fell 14% in early trading as the Tennent’s, Bulmers and Blackthorn brewer warned that profits would be lower than previously expected, with softer trading in November and early December.
It put this down to weak consumer confidence following the UK Budget, which led to softer-than-anticipated demand in hospitality.
C&C also, somewhat confusingly for a brewer, also cited an adverse product mix, as consumers "continue to move away from the consumption of wine and spirits, in favour of beer".
Adjusted operating profit for the year to February is now expected to be between €70 million and €73 million.
The company said trading over the Christmas period was in line with expectations, but weakness has resumed in January.
Performance in the Distribution segment was affected by subdued volumes and pricing pressures.
However, the group noted that branded products, including Tennent’s and Bulmers, performed well during the festive period, supported by innovation initiatives.
C&C said it remains financially robust and cash generative, with €92 million of its €150 million capital return plan completed so far.
Looking ahead, the group anticipates that macroeconomic and consumer pressures will persist into the new financial year, with profits anticipated to remain broadly flat year-on-year due to planned volume reductions in Distribution, with cost savings expected to lag revenue impact.