22/02/2006
AG Barr is steering its iconic Scottish drink Irn Bru into the path of energy drink titan Red Bull and hopes that, like the advertising slogan of its taurine rival, this will give it wings.
Describing the move as its ‘most important new product development to date’, AG Barr is launching its own energy drink, branded ‘Irn-Bru 32’. Barr’s own slogan is that the drink delivers ‘pure mental stimulation’ and it represents a total spend of some £3 million in R&D and marketing. The launch will be supported by a considerable promotional campaign, with the cans available in stores throughout the UK from early March.
The market it is targetting is dominated by privately owned Red Bull, easily Britain's best-selling energy drink, with more than 200 million cans imbibed each year. Chairman Robin Barr, great-great grandson of the founder and one of only two people alive who know the secret recipe to Irn-Bru, says the 32 version ‘tastes fantastic’ – an apparent attribute that he hopes will make it sell very well.
In January, ahead of preliminary results due out in March, Barr confirmed that full year results would be in line with market expectations, despite tough conditions. The company’s effective marketing of its other strong brands, including standard and Diet Irn-Bru, Orangina, Tizer and D&B, keep things bubbling along nicely. After £8m of pre-tax profits at the last interims in September, broker Bell Lawrie predicts revenues of £131m for the full year will pour through to pre-tax profits of £16.6 and 59.9p of earnings per share. Irn-Bru 32 won’t provide any extra stimulation until the next interims at least. Add.
| Market cap: | £185.17m |
| PE Forecast: | 15.9 |
| Share price: | 951.5p |
| LSE | £217.58m |
1118.00p
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13.00p
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| Other company articles: |
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