Nichols 2021 Preliminary Results

Nichols plc (‘Nichols’ or the ‘Group’), the diversified soft drinks Group, announces its Preliminary results for the year ended 31 December 2021 (the ‘period’).

31 December 2021
31 December 2020
Group Revenue 144.3 118.7 +21.6%
Adjusted Operating Profit1 21.9 11.7 +88.1%
Operating (Loss)/Profit (17.6) 6.6 (366.8%)
Adjusted Profit Before Tax (PBT)1 21.8 11.6 +87.9%
(Loss)/Profit Before Tax (PBT) (17.7) 6.5 (370.0%)
Adjusted PBT Margin1 15.1% 9.8% 5.3ppts
PBT Margin (12.2%) 5.5% (17.7ppts)
EBITDA2 23.7 16.5 +44.1%
Adjusted earnings per share (basic)1 46.15p 25.56p +80.6%
(Loss)/earnings per share (basic) (60.04p) 13.14p (82.0%)
Cash and cash equivalents 56.7 47.3 +19.8%
Proposed Final Dividend 13.3p 8.8p +51.1%
Full year dividend 23.1p 36.8p (36.8%)

• Vimto Brand value in the UK +6.3%3
• Vimto squash outperformed the dilutes market by +10.4%3
• Vimto Brand value +13.2%4 since 2019 versus the wider soft drinks market of +11.0%4
• Vimto Brand continues to progress internationally, with revenue +21.0% (underlying5 +9.8%)
• Africa and Rest of World significantly ahead
• Underlying5 Middle East revenues broadly flat (-2.0%)
• Out of Home (OoH) continues to recover from the pandemic with revenues +77.4%
• Revenues -31.4% versus 2019, with Q4 improving run rates versus pre-Omicron
• Fixed costs still weighing heavily on overall financial performance
• Gross margin improvement to 45.2% (2020: 41.8%)
• Completion of Middle East marketing investment
• Significant volume recovery in OoH
• Continued strong cash performance, Free Cash Flow6 +£17.5m (2020: £17.6m)
• Cash Conversion7 at 103% (2020: 186%)
• OoH impairment review completed and strategic review commenced
• Exceptional charge of £39.5m
• £36.2m of this attributable to non-cash impairment of OoH Goodwill
• £0.6m operational review and restructuring (cumulative £0.9m)
• £2.6m net liability relating to tax and interest on historic incentive schemes
• Final dividend of 13.3p proposed, reflecting 2x cover8

1 Excluding Exceptional items
2 EBITDA is the statutory profit before tax, interest, depreciation, and amortisation
3 Source: Nielsen, Total Coverage 12 months to 1 January 2022
4 Source: Nielsen, Total Coverage 12 months to 1 January 2022 vs. 12 months to 4 January 2020
5 Excluding the impact of the Group’s marketing investment in the Middle East
6 Free Cash Flow is the net increase in cash and cash equivalents before acquisition funding and dividends
7 Cash Conversion is the Free Cash Flow / Adjusted Profit After Tax
8 Dividend cover is adjusted basic earnings per share divided by the dividend per share

The continued strengthening of the Vimto brand, both in the UK and internationally, combined with the benefits of our diversified business model, has ensured another resilient financial performance in the period. We have achieved significant outperformance of the Vimto brand in dilutes in the UK, and we delivered solid growth internationally, particularly in Africa where we continue to grow, and critically delivered a robust performance in the Middle East. In this, my 50th year with the Group, I would like to wholeheartedly thank everyone for their efforts. The Coronavirus pandemic has continued to present significant challenges for us all throughout 2021. Our first and most important objective continued to be the protection and wellbeing of our employees and customers. Throughout these difficult times, I have been delighted to witness how our colleagues have pulled together and consistently demonstrated their values and commitment to our business.

John Nichols, Non-Executive Chairman

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