Nichols (LON:NICL) , the supplier of soft drinks issued a decent update covering the first four months of its 2011 financial year end (31st Dec). UK sales have increased by 12.5% year on year and are ahead of internal expectations despite the tough economic backdrop. International sales in core markets of the Middle East (Vimto is epecially popular during Ramadan) and Africa have also been ahead management expectations as has the performance of the dispense business including the recent acquisition of the remaining 50% stake in Dayla Liquid Packaging. The new Levi Roots (of Dragons Den fame) range of Reggae Reggae Caribbean drinks has also been very well received by major trade customers. They also confirmed that in 2011 they would again increase total brand investment, including the complete update of Vimto brand packaging and a new, multi-media advertising campaign launching in May 2011. A great business with a rock solid balance sheet – net cash was nearly £15m at 31st December 2010. The shares currently trade at 16.8x current (2011) year estimates falling to 15.7x for the following year – remember all that cash!

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