Fever-Tree, the maker of posh tonic waters and sodas is poised to expand across the US on the back of a 66 per cent increase in sales, during 2017.
The strong demand for Fever-Tree’s low calorie tonic which doubled in sales last year was a major contributor to the drink firm becoming the number-one mixer brand in shops.
Sales of Fever-Tree’s light tonic accounts for more than 30 per cent of the brand’s off-trade sales. Pre-tax profits jumped to £56.4 million in 2017, as sales grew by 66% to £170.2 million.
Tim Warrillow believes 2017 has been a significant year
Fever-Tree’s plans to expand across the US follows its launch there in December.
Analyst Phil Carroll, at Shore Capital, commenting on the expansion said: ‘The key for us going forward is the opportunity in the US, which has significant potential given its maturity profile in terms of premiumisation, compared to the UK but is also quite a complex market to compete in.’
Sales in the US, the company’s second largest single market, rose 36% on a constant currency basis, while Continental Europe revenues rose 37%.
Tim Warrillow, co-founder and chief executive of Fever-Tree, believes 2017 has been a significant year of progress for the company. He said: ‘We have continued to see strong growth across all our regions, with the UK once again delivering an exceptional performance culminating in Fever-Tree ending the year as the leading mixer brand at UK retail.’
The drinks firm plans to extend its low calorie mixers across all its major flavours over 2018.
Fever-Tree’s shareholders will receive full-year dividends totaling 10.65p per share, up 58 per cent on last year.
The company has been one of the fastest growing on Aim in recent years. In 2017, its stock soared by101 per cent.
As well as boosting its low calorie ranges, Fever-Tree also recently expanded its dark spirits mixing range, with the launch of Smoky Ginger Ale and Spiced Orange Ginger Ale, ahead of what it believes will be a revival in demand for dark tipples.