Fevertree Drinks reports modest growth as US expansion offsets UK stagnation

Premium drink mixer brand Fevertree Drinks has today reported a modest uptick in revenue for 2023 as its US expansion plan paid off last year.

The company told markets this morning revenue for the year to the end of December 2023 rose by six per cent. Sales in the UK market ticked lower by one per cent, offset by growth of 22 per cent in the US.

Following last year’s growth, the US market overtook the UK as the company’s largest single market with sales of £117m compared to £114.8m in the UK.

However, the firm said that it remained the “clear market leader” in the UK market, with a 45 per cent share of the total mixer market.

Overall, the company reported a gross profit for the year of £117m, down two per cent compared to 2022. Its adjusted earnings before interest, tax, deprecation and amortisation (EBITDA) slumped 23 per cent due to the lower gross profit and a 320 basis point contraction in the EBITDA margin.

Fevertree reported diluted earnings per share of 13.2p, down 38 per cent. It increased its dividend by two per cent to 16.6p. Cash on the balance sheet at the end of the period was £59.9m, down 37 per cent from the £95.3m at the end of 2022.

However, the company said it had started 2024 in line with expectations and remained on track to double EBITDA in 2024.

Tim Warrillow, co-founder and chief of Fevertree said: “2023 was a year when the Fevertree brand once again grew in breadth and depth, with market share gains across the globe. Perhaps the most significant milestone was establishing the US as our largest region, and with it, extending our market leadership position in both the US Tonic Water and Ginger Beer categories.

Warrillow added: “Taken alongside softening inflationary pressures, the operational efficiencies we are delivering means I am confident that we are entering 2024 in a very strong position from an operational perspective and have an excellent platform for strong profitable growth going forward.”