By Yamini Kalia and Yadarisa Shabong
(Reuters) -Fevertree Drinks cut its annual revenue growth forecast on Thursday as an unexpected wet weather in Britain dampened sales of its tonic water and cocktail mixers at bars and restaurants this summer.
Shares of the company, which makes premium tonic, ginger beer and other mixers, fell as much as 11% to a more than eight-year low.
Unusually cool and wet weather in Britain weighed on spirits and fewer people went out at the start of summer, hurting sales and demand for everything from clothes to cocktails.
Sales in the UK, its largest market alongside the United States, should resume growth in the second half of the year, finance chief Andy Branchflower told analysts and investors in a conference call.
“We are anticipating growth back in the market for next year, but that would be low single digits,” he added.
Low consumer sentiment also contributed to the lacklustre first-half performance, Fevertree said.
Fevertree expects revenue growth of about 4% to 5% for the full year, lower than the 10% initially projected in March.
Analysts, on average, were expecting revenue growth of about 7%, according to a company-compiled consensus.
The London-based firm, however, is still growing market share, and has plans to launch more products such as an espresso martini mixer for the Christmas season.
“Fevertree is doing the right things, gaining share and delivering on gross margin recovery, in a difficult market,” Investec analyst Matthew Webb said in a note.
At a time when drinkers in some markets ditch beer for spirits or cut back on drinking altogether, Fevertree said it was capitalising on long-term trends as adults continue to seek out a broader range of premium drinks, both with and without alcohol.
Fevertree, founded in 2003, posted half-year revenue of 172.9 million pounds ($225.55 million), down from the 175.6 million pounds logged last year.
($1 = 0.7666 pounds)
(Reporting by Yamini Kalia and Yadarisa Shabong in Bengaluru; Editing by Sherry Jacob-Phillips, Christopher Cushing and Tomasz Janowski)
