C&C Group Reports Strong Profit Growth and Dividend Increase in FY2025 Results

Right then, let’s dive into the FY2025 results from C&C Group – the folks behind your Tennent’s lager and Bulmers cider. The headline? A proper turnaround story gaining momentum. While the wider consumer environment remains about as predictable as British summer weather, C&C’s showing resilience where it counts: profits up, dividends rising, and that all-important cash flow still gushing. Here’s what investors need to know.

A Financial Snapshot: Margins Flexing, Profits Climbing

Forget top-line fireworks for a second – this story is about efficiency and earnings power.

• Steady Revenue, Surging Profits: Net revenue held firm at €1,665.5m (basically flat vs FY2024). The real action was further down the P&L. Adjusted EBITDA jumped a very healthy 19.5% to €112.0m, while Operating Profit before exceptionals leapt 28.5% to €77.1m. That’s serious margin expansion – operating margin up 1.0 percentage point to 4.6%.
• Earnings Bounce: Adjusted Profit Before Tax hit €55.9m (up €17.1m), translating to Adjusted Basic EPS of 11.7 cents (up 3.6 cents). Statutory figures look even rosier year-on-year due to significantly lower exceptional costs, but the adjusted numbers tell the underlying operational improvement story clearly.
• Cash is King (Still): Free cash flow (excluding exceptionals) came in at €68.8m. While down €16.8m year-on-year (attributed to specific working capital moves around customer acquisitions and the cider business transfer), it underscores the fundamentally strong cash-generative nature of the business. Net debt (excluding leases) edged up to €80.9m, but crucially, the leverage ratio remains exceptionally comfortable at 0.9x Adjusted EBITDA.

Operational Highlights: Fixing the Foundations

Beyond the numbers, the year was marked by tangible operational progress:

• Brand Power Endures: Tennent’s (#1 beer in Scotland) and Bulmers (#1 cider in Ireland) both gained market share. The premium portfolio (Menabrea, Heverlee etc.) continues its encouraging growth trajectory.
• Distribution’s Rocky Road Smoothens: Remember last year’s ERP system nightmare? Fixed. Service levels recovered impressively – hitting 98% “On Time” and 96% “In Full”. Customer numbers in the key Matthew Clark Bibendum (MCB) wholesale business grew by 8%.
• Taking Control of Magners: A significant strategic shift. C&C took back direct control of Magners distribution in GB from Budweiser Brewing Group (BBG) on 1 Jan 2025. The relaunch is underway, with early Off-Trade share gains reported. This gives C&C full rein to invest and revitalise the brand (cue the new ‘Magnertism’ campaign).
• Simplifying the Beast: The “Simply Better Growth” programme kicked off. This isn’t just jargon – it involves closing 5 depots (network now at 25), significantly reducing the number of legal entities (target: ~30 by FY2026 end), and pouring resources into strengthening financial controls after last year’s accounting woes. Streamlining is the name of the game.

Segment Deep Dive: Branded Resilience & Distribution’s Comeback

Branded: Holding the Fort, Premium Shines

• Revenue: €298.6m (down 5% YoY). Reflects a stable core (Tennent’s, Bulmers) and premium growth, offset by UK cider weakness (poor summer, Magners transition) and the disposal of the non-core Irish soft drinks biz.
• Profitability: The star here. Operating profit rose 3% to €46.1m, with margins expanding 110 basis points to a robust 15.4%. Efficiency gains and favourable mix (premium) are delivering.

Distribution: From ERP Nightmare to Service Champion

• • Revenue: €1,366.9m (up 2% YoY). Driven by a strong 3.5% increase in GB (MCB) thanks to those new customers and outperforming the market. Ireland (IOI) was down 4.3%, primarily due to the BBG portfolio changes.

Profitability: The standout recovery. Operating profit more than doubled (+101%) to €31.0m. Margins jumped 120 basis points to 2.3%. Restored service levels and cost actions are feeding straight through.

Shareholder Returns: Rewarding Patience

C&C is putting its cash flow to work for owners:

• Dividend Hike: Proposed final dividend of 4.13 cents per share (up 4% on FY2024’s 3.97 cents). Combined with the interim dividend (2.00 cents), the full-year payout is 6.13 cents per share.
• Buybacks Progressing: The €150m capital return programme (dividends + buybacks over FY25-FY27) is on track. €52.9m returned in FY2025 (including FY24 final & FY25 interim divs). Two €15m buyback tranches completed in FY25 (16.1m shares bought). A further €15m tranche commenced 1 May 2025 (with €2.2m already spent by 20 May).

The confidence behind this programme is palpable.