Britvic to reduce calorie count of its soft drinks by 2020

posted by Marino Donati
in Law
24 May 2016

Britvic said it was committed to a 20% cut in calories in its soft drinks by 2020 as it posted an increase in profits for the first half of the year.

As it released its interim results, the drinks firm said that the main risk to performance was changes to consumer preferences to sugar and sweeteners and the risk of legislation that impacted sugar sweetened drinks.

However, the company said that it had been reducing the sugar in its drinks for the last four years and was well placed to respond to the proposed sugar tax.

Britvic posted a 5.1% increase in revenue to £678m for the 28 weeks to April 10, 2016, and pre-tax profits increased by 7.3% to £54.5m. The business continued to increase market share in all its key markets.

The company’s UK carbonated drinks business saw half-year revenue increase 2.4% and the focus on the no-sugar Pepsi Max, including a new cherry flavour, continued to be very successful, the company said.

However, Britvic said that its decision to remove the added sugar range from its Robinsons brand, along with competitive own label pricing, had impacted on its performance and contributed to a disappointing performance of its UK stills portfolio.

Britvic CEO Simon Litherland said: “As the category leader, removing added sugar from this family brand is appropriate for the long term as consumers seek ‘Better for You’ soft drinks.”

The March budget proposed a tax on soft drinks based on their sugar content from 2018. 

Britvic said it was “disappointed” about the decision to introduce the tax but said it had been building its portfolio of ‘Better for You’ soft drinks for some time.

“As currently proposed 66% of our volumes fall below the proposed tax bands,” said Litherland. “Since 2012 our actions, such as the removal of full sugar Fruit Shoot and Robinsons and the reformulation of brands such as J20 and Drench, have led to an annualised 19 billion calorie reduction across our portfolio. We will continue to play this leadership role and our focus will be on creating a portfolio of brands which appeals to evolving consumer preferences.”

Britvic said it would also re-launch its juice drink Drench with a new brand identity and lower sugar formulation.

“As consumer trends move to “Better for You” products, our innovation programme is well positioned to capitalise on the future growth opportunities,” the company said.

It added: “Britvic already offers a broad range of products and has taken significant steps in recent years to reduce added sugar and reformulate drinks using Stevia for example and remains committed to a 20% calorie reduction by 2020. Britvic will engage fully in the government consultation process taking place in the summer with regard to the proposed tax.”

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