Divisional Review
Cider - Export


Constant currency(i) FY 2010/11
€m
FY 2009/10
€m
Change
%
       
Net revenue 21.5 16.2 32.7%
- Price /mix impact     (1.1%)
- Volume impact     33.8%
Operating profit 2.7 1.5 80.0%
Operating margin (Net revenue) 12.6% 9.3% 3.3ppts
Volume – (khl) 119.6 89.4 33.8%

Gaymers
Export cider includes sales for Magners in all markets outside of the Republic of Ireland and the UK.

The accelerated growth evident in the first half of FY2010/11 continued in the second half and full year volumes were up 34% in comparison with FY2009/10. North America and Australia remain the key expansion markets for Export, now accounting for 58% of total export volumes and 70% of the volume growth in the year. Iberia returned to positive territory in FY2010/11 with a volume increase of 6%. Finland and France are relatively small cider territories for C&C but both enjoyed strong growth in the year.

Category data for the export markets are less comprehensive than those available in either GB or ROI. The cider category in the USA is estimated to be around 450k hl and growing at 16-17% per annum. Magners has around 10% volume share in the USA with momentum in the brand largely attributable to widening distribution.
Growth for Magners in the USA last year was 38%. In Australia, the total cider market is considered to be around 300k hl and growing at 13-15%. Magners growth in Australia was 74% last year and it is likely to overtake Iberia as C&C’s second biggest Export market by volume in FY2011/12.

The negative price/mix impact of 1.1% is a feature of the product mix in Export markets rather than price. Relative to other territories, net revenue per litre is lower in the USA.

Operating margins of 12.6% reflect a level of marketing investment in the brand that is appropriate at this stage of the development cycle.

(i) On a constant currency basis, constant currency calculation is set out on page 20

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