Distribution remains key to Frucor success

Frucor has announced revenues of $120.7 million for the six months to the end of December 2000 - a jump of 55% compared with the same period in 1999.

The company says revenues in the second quarter of $67 million were ahead of the $53.7 million recorded in the first quarter, reflecting the seasonal upturn and business growth in Southern Hemisphere markets.

Frucor MD Mark Cowsill says first half revenues were 5% below prospectus with a shortfall in the UK.

A lack of distribution depth in the UK and Ireland has held back sales there, though there has been improvement recently with weighted distribution rising from 25% at the end of September to 32% at the end of 2000.

The company's objective is for 50% weighted distribution by the beginning of the northern summer in those two markets.

Offsetting the less than spectacular UK sales is the news that markets in New Zealand and Australia both exceeded budget for the half year.

Although the fruit juice and drinks category, which represents 30% of the company revenues, showed no growth during the period, sales of a new product, Fresh Up Vits, are more than double forecast.

Mr Cowsill says the new age beverage category, representing 49% of group revenues, has also grown by 124% compared to last year.

"In New Zealand both gforce and V have performed well with V's market share for the last quarter in both grocery and petrol and convenience being above 70%."

Mr Cowsill says water products H2Go and Mizone have also fared well, and revenues for V in Australia have continued to grow strongly, particularly during the second quarter.

"Sales in November and December were well ahead of budget, resulting in the first half being ahead of a high growth budget."

Frucor acquired the Spring Valley sales and distribution infrastructure in Australia just last week and is hoping the greater control will lift sales.

Mr Cowsill says revenues during the second half are forecast to be $134 million, which will produce a full year revenue figure of $255 million compared with the prospectus forecast of $264 million.

"Overall Frucor is forecasting very good growth in New Zealand and Australia and improving positions both in the UK and South Africa," says Mr Cowsill. "Second half growth versus the same period last year is predicted to be around 31%."

The company is planning on releasing year-to-date figures when it reports half yearly results at the end of February.

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