Key highlights in FY 2023:
- Exceptional year with business delivering market-leading growth
- Turnover growth of 37% driven by both greater distribution and rate of sale
- Robust margin management in volatile market
- Transformational period of growth for key brand Juice Burst
- Enormous potential to further develop brand, Firefly
Commenting on the exceptional performance, Chief Executive Officer Sarah Baldwin said: “We are delighted to share these numbers, which capture a transformational period for the business and its brands. Juice Burst in particular continues to outperform, gaining significant market share, through both greater distribution and rate of sale. Our performance, we believe, is thanks to a very clear and unrelenting focus on producing very high-quality juice, made with natural ingredients and at a compelling price point.”
Chairman Rooney Anand said: “This exceptional and market-leading performance reflects a very strong business that has developed huge momentum, driven by an exceptional management team, and two excellent brands delivering impressive growth.”
It has been a transformational year for Purity Soft Drinks. The business and its brands have performed strongly in what has been, and continues to be, a volatile and extremely demanding market. Against this backdrop, the business has made positive and material progress as measured against every single one of its key performance indicators.
Group sales in the year to 31 March 2023 grew 37%, to £27m, driven by a combination of new business growth, extended distribution points with existing customers, and rate of sale on both brand ranges, Juice Burst and Firefly.
On the strength of this sales performance, and our increasing scale, pre-tax profits rose from £1.6m in the prior year, to £3.2m. Margins were broadly in line at 38.7% (FY22: 38.5%) as the business mitigated inflationary headwinds through a combination of measures. These include cost savings, greater efficiencies and some selling-price increases. Central overheads, as a percentage of turnover, reduced materially, from 23.2% to 20.2%.
The Purity Soft Drinks portfolio has significantly outperformed the category in the latest 12 months, delivering 33.4% in value growth. The business is the fastest-growing group in the top 20 soft drink manufacturers in the UK by volume, up 19.4%.
Juice Burst continues to go from strength to strength. Based on SRV (Suggested Retail Value) it is now a c.£75m brand, having grown by 41.1% in value, in the ‘drink now’ convenience category, in the past 12 months alone.
This momentum is driven by ever-increasing distribution, with the brand widely available in supermarkets, convenience and foodservice – including hospitality and education. Juice Burst also performs very well in terms of rate of sale; the brand is landing with consumers due to its compelling value, which gives convenient access to one of our ‘five-a-day’, at a great price-point.
With innovation and new product development (NPD) key to category success, we continue to develop new and exciting variants, having recently brought to market Juice Burst Summer Fruits.
If we have one brand firmly established and performing extremely well in the natural juice category, we have another in Firefly, which although is at a different stage of its development, we believe has a significant opportunity to do the same in the adult soft drinks segment. In the period, we conducted a review of the Firefly brand, launching a new visual identity, new packaging, and marketing campaign, and we are focused on driving distribution, rate-of-sale, and NPD for this unique brand.
People, culture and planet
We continue to build our team operating from our longstanding business and production centre in Wednesbury, which has been home to the company for more than 130 years. As an employer embedded in this local community, we see exceptionally low staff turnover and enjoy strong employee relations. We regularly assess staff satisfaction and sentiment, and for the past two years 100% of our team have told us (anonymously) that they are proud to work for Purity Soft Drinks.
In terms of our values and impact, we are committed to delivering meaningful and positive change in our industry. In 2017, we took the decision to not work with any added sugar or flavourings in our products. Pursuing this approach of natural ingredients in our products wherever possible – and absolutely no added sugar ever – has served us well, and since taking this decision our business has, in volume terms, doubled.
Our packaging currently comprises 30% recycled (rPET) plastic. We are committed to going further and entirely support the move to a fully-looped recycling system. We are currently testing tethered caps and plan to roll this out to all packaging in the current financial year. We are also road-mapping our net zero journey, including work to establish our scope three carbon footprint.
Our CEO, Sarah Baldwin, sits on the board of the British Soft Drinks Association and although now delayed, we continue to be resolute supporters of a Deposit Return Scheme.
Since the year-end, the business has continued to perform strongly, against a market that remains demanding and volatile. Although easing, we expect the cost inflationary environment to continue to present challenges, and with extreme weather and disease affecting the production of oranges in Brazil and Florida, we remain in close contact with our suppliers to monitor the impact that reduced supply may have on pricing in the next year.
That said, we remain very confident about the opportunities we have ahead of us. We continue to see strong growth in Juice Burst, which is landing well with consumers seeking great juice and a convenient health ‘hit’ at a great price. We are also excited by the progress we continue to make with Firefly.
The performance of Purity Soft Drinks in this period, and in recent years, is due to a relentless focus on staying true to what we think is right; making great juice, to the highest standard, based on natural ingredients and their great flavours.