British soft drink producer Nichols PLC (AIM:NICL) saw the leaked value of the stock as revenue slipped over the nine months leading up to September 30, 2020.
The company’s statement said, “The ongoing Covid-19 pandemic continues to affect the soft drinks industry, as expected in the group’s preliminary results in July.” While the company enjoyed a “strong” 5.8% value growth in African businesses with a 10.5% increase in revenue from the start of the year, the company saw a 45.2% decline in its home (OOH) sector in the third quarter.
Among the “very challenging” deals, the demand for packaged, frozen and mixed technical solutions all fell in decline, amid whether outlets are closed or capacity decreasing. This brought the company’s total revenue down 16.5% year-on-year to £91.7 million.
Nichols said he is sincerely focused on cost management activities to “build better” from the pandemic. It reviewed its operational structure and attempted to reduce its marketing investments, and said it would show staff redundancy by the first quarter of 2021.
With the lingering uncertainty of COVID risk factors in mind, the company provided an adjusted profit of £11 million to £14 million prior to its fourth quarter tax guidance. Nichols added that the company’s cash generation remains “very positive” until 2020, with cash and cash equivalents totaling £45.4 million at the end of the period.
Speaking about the results, non-executive director John Nichols said: “As the group continues to focus on ensuring the right structure to provide its long-term strategy, the group has made difficult decisions that are subject to consultation that many roles will be removed from our structure. These difficult decisions have not been underestimated. I am grateful for all Nichols colleagues for their continued efforts and commitment.”
“While acknowledging the current and short-term impact of the pandemic on the soft drink market, the board continues to believe that Nichols, supported by the strength of the Vimto brand and the group’s diversified business model, remains well placed to provide long-term strategic ambitions.”
After the update, Nichols stock lost pop and fell 5.83% to 1,130.00pa shares of 11/20/19. The price is behind the 1,387.50p total hypertrophy high, with analysts’ target price being roughly 6.2% short of 1,200pa stocks.
Analysts currently have a “hold” consensus stance on equities. The AP/E ratio is 23.69, with an average consumer goods being 52.90. The MarketBeat community also offers a “low performance” rating of 54.11%.
