Fevertree Drinks Plc, whose tonic waters have been boosted by U.K. bartenders pairing them with small-batch gin, surged in London after saying first-half earnings doubled and full-year results will beat expectations.
The stock soared as much as 11 percent to a record 1,935 pence in London, the steepest intraday gain in nine months. The company announced first-half adjusted earnings of 25.2 million pounds ($32.8 million) as sales gained 77 percent.
The London-based company had “another blockbuster period,” wrote Nicola Mallard, an analyst at Investec.
Possible Takeover Target?
Fevertree, with a market value of 2.2 billion pounds, has been mentioned by Shore Capital analyst Phil Carroll as a potential takeover target for distillers such as Pernod Ricard SA and Bacardi Ltd. The stock has more than quintupled in the past two years as the company’s tonic waters have gained market share from larger rival Schweppes.
With ingredients such as quinine sourced from a far-flung plantation in Congo, its mixers are increasingly promoted by bartenders who mix them with artisanal gin and other spirits.
The drinks maker has expanded distribution of its smaller-can format to drive incremental growth at U.K. retail outlets. It is also introducing new flavors such as Madagascan cola to mix with dark spirits including rum and has agreed to sell its products across the Virgin Atlantic fleet starting this month.
News by Bloomberg, edited by ESM. Click subscribe to sign up to ESM: The European Supermarket Magazine.
