Fever-Tree revenue declines 3% in 2020

Despite a strong off-trade performance to offset declines in the on-trade, Fever-Tree’s revenue fell 3% in 2020.

For the 12 months to 31 December 2020, Fever-Tree saw revenue fall to £252.1 million (US$351.2m), down from £260.5m (US$362.9m) the previous year.

The group said a ‘very strong off-trade performance’ was able to make up for widespread on-trade closures this past year due to the Covid-19 pandemic. The on-trade has historically accounted for around 45% of Fever-Tree’s revenue.

Gross profit fell by 12% in 2020 to £116.3m (US$116.0m), compared with £131.5m (US$183.2m) in 2019.

Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) declined by 26%.

Tim Warrillow, co-founder and CEO of Fever-tree, said: “Our performance in the off-trade was especially strong, exceeding our expectations across all our regions.

“Numerous periods of lockdown during the year encouraged increased consumer interest in premium spirits and stimulated excitement about mixing drinks at home, attracting more households and new consumers to the Fever-Tree brand than ever before.

“Consequently, we have increased our penetration in the UK, driven value share gains in the US, and Europe, and gained real traction in Canada and Australia.”

Fever-Tree said the off-trade ‘exceeded expectations’ across all regions, even when the on-trade was reopened, and helped the brand retain its place as the number one mixer in the UK, accounting for 40.1% of total market value share.

Furthermore, Fever-Tree reported ‘significant momentum’ building in the US and a ‘very strong’ second half in Europe, driven by strong off-trade sales and importer restocking.

It also made ‘excellent progress’ in its two biggest rest-of-the-world markets: Australia and Canada.

2021 guidance

Despite the ongoing challenges the pandemic continues to present, Fever-Tree has reintroduced guidance for 2021.

The brand expects the off-trade to remain strong, even as the on-trade begins to reopen. As such, Fever-Tree believes it remains ‘well placed’ across its regions and channels to see revenue grow between 12% and 16% in 2021, with gross and EBITDA margins in line with 2020.

Warrillow added: “Whilst our on-trade business remains impacted by the continued shutdowns and restrictions across many of our regions, we have had a very positive start to 2021 across the off-trade.

“The momentum seen in 2020 has continued in the first part of the new year with strong sales in our major markets, most notably the UK and US.

“We are working closely with our on-trade customers as they prepare for reopening across our regions and while we are mindful of the gradual nature of easing of restrictions, we share their optimism and excitement for this important channel in the months and years ahead.”