A.G. BARR (LON:BAG) executives told investors the company delivered “strong and consistent financial progress” in the year to January 2026, combining revenue growth with margin expansion and continued cash generation as it advanced a strategy centered on core brand investment, faster innovation, and targeted M&A.
Chief Executive Officer Euan Sutherland, speaking alongside Chief Finance and Operating Officer Stuart Lorimer, said the group is “shaping our customer value proposition to be aligned to current and future consumer needs,” and argued that the company’s financial framework—focused on revenue growth, operating margin, and return on capital employed (ROCE)—is working.
Full-year performance: revenue up, margins back in target range
The company reported double-digit profit growth for the second year in a row and an 11% improvement in EPS, according to Lorimer. Operating cash flow was “over £60 million” for the year, and the company ended the period with “just over £40 million in the bank,” which Lorimer said was £22 million lower than the prior year following investment in the asset base and acquisitions.
Reflecting the year’s performance, Lorimer said the board is proposing a full-year dividend of £0.1871, an 11% increase year over year, which he said would deliver £21 million to shareholders.
On capital allocation, Lorimer said the company began the year with GBP 63.9 million in net cash and generated around GBP 55 million from the business, resulting in “pre-allocation cash flow of almost GBP 119 million.” He said deployments included roughly GBP 30 million in capital investment, GBP 28 million of acquisitions within the period, and “just over GBP 19 million” returned via dividends.
Brand and portfolio trends: pricing resets, innovation, and distribution gains
Lorimer said A.G. Barr’s three core soft drinks brands—IRN-BRU, Rubicon, and Boost—were a key focus, with pricing repositioning ahead of major redesigns and increased media investment. He said the price changes weighed on first-half performance but “unwound in H2,” and the brands exited the fourth quarter “with good sales momentum.”
He noted that IRN-BRU’s revenue mix has declined as the portfolio diversified—IRN-BRU was 38% of revenue three years ago versus 32% now—while still growing revenue 16% over that period. Rubicon revenue increased 40% over the same timeframe, he said. Boost, meanwhile, “delivered a standout performance with fantastic double-digit revenue growth” following its earlier pricing repositioning and brand refresh in 2024.
Sutherland highlighted marketing and innovation initiatives across the core brands:
- IRN-BRU: Sutherland said the “Made in Scotland from Girders” campaign increased spontaneous awareness “significantly,” and that “one in five nationwide consumers exposed to the campaign either bought IRN-BRU for the first time or increased their purchase frequency.” He also pointed to flavor extensions launched in March 2026, including IRN-BRU Ice Cream and IRN-BRU Xtra Raspberry Ripple, and said total grocery distribution growth on IRN-BRU flavors now exceeds 2,500 new distribution points.
- Rubicon: Sutherland said Rubicon’s “big flavor” creative scored in the top 20% of all ads, supporting awareness gains. He also cited Rubicon’s expansion into “healthy hydration,” including a Squash launch into 600 Sainsbury’s stores and the introduction of Rubicon Twist, a flavored water launched as a Tesco exclusive, which he said performed “ahead of initial expectations.”
- Boost: Sutherland said A.G. Barr is refreshing Boost’s above-the-line creative and has partnered with Super League as its official soft drinks partner. He said Boost awareness has risen such that “two out of three people in the U.K. now [are] aware of the brand.” He also referenced launches into hydration waters in convenience and powders in e-commerce, and noted recent grocery listings including Morrisons and new placements in Tesco Northern Ireland and Scotland and Asda Express nationally.
In addition to the core brands, Lorimer said the “portfolio brand” segment, representing 35% of revenue, grew just over 5% in aggregate. He said continued declines in Funkin on-trade and the disposal of the Strathmore brand were more than offset by strong performance from KA, MOMA, Simply Fruity, and the mid-year acquisition of Innate-Essence, supported by “innovation, distribution gains, and improved supply.”
Costs, commodities, and Middle East conflict: limited direct impact so far
Lorimer told investors input costs generally stabilized after peak inflation in 2023-2024, “with the notable exception of aluminum,” which he said rose significantly in the second half of 2025. He said the company has “good cover across all commodities for much of calendar 2026,” and described aluminum pressure as tied to capacity, demand growth, speculators, and “conflict-related energy spikes.”
Asked directly about potential cost pressures and supply issues from the current Middle East conflict, Lorimer said the situation is “fast-moving” and not something the company would try to predict. He added: “We have no revenue exposure to the Middle East. We have no supply security concerns from the conflict situation.” He said exposure is mainly to energy spikes and that logistics fuel is a “manageable cost.”
Supply chain investments: CapEx peak ahead and efficiency focus
The company’s multi-year capital program remained central to the margin and capacity story. Lorimer said cash CapEx of “just over GBP 30 million” in FY 2025-26 was focused on Cumbernauld, where A.G. Barr completed the fifth and final phase of a line refresh program by installing a new high-speed can line. He said the line replaces an end-of-life asset and provides a “50% uplift in capacity” and additional format capability, and is currently being commissioned and “performing well.”
Lorimer said the rolling plan has taken Cumbernauld from a 25 million case output in 2022 to a 46 million capacity in 2026. He expects CapEx to peak at about GBP 40 million in FY 2026-27, funding final payments for the Cumbernauld refresh, work to insource the Boost sports range in Cumbernauld, a second independent can line at Milton Keynes (targeting commissioning in early 2027), and scaling manufacturing capacity for Innate-Essence. He also said heat pump installations are expected to commence in the next nine months as part of net zero initiatives.
Acquisitions and outlook: low double-digit growth expected, integration costs flagged
Management emphasized recent M&A as a route into faster-growing segments. Sutherland said Innate-Essence, Frobishers, and Fentimans demonstrate intent to access “higher growth segments” and broaden the market through targeted deals.
Sutherland said the company acquired 100% of the Frobishers brand for “1x sales” and moved quickly to integrate it, although it is not yet being insourced until volumes reach “critical volume targets.” He said the company expects both revenue and profit growth from Frobishers in FY 2026-27.
He added that A.G. Barr acquired 100% of Fentimans for “1.5x sales” shortly after year-end, describing plans to consult with employees on integration, “right-size” the international business, and rationalize the tail of SKUs in the U.K. to improve manufacturing efficiency and profitability. He said opportunities to insource volume, reset the brand, and increase innovation would begin to be captured from the end of the first half, with more impact likely in 2027 and 2028.
Looking ahead, Lorimer said A.G. Barr expects “elevated low double-digit % revenue growth” in FY 2026-27, supported by around GBP 35 million of revenue contribution from the Frobishers and Fentimans acquisitions, while maintaining operating margin in the 14%-16% range. He also said integration will initially be “slightly ROCE dilutive,” pushing ROCE toward the lower end of the 19%-21% target range before becoming accretive as benefits land in 2027 and early 2028. Lorimer said the company expects one-off integration costs of about GBP 4 million in FY 2026-27.
On funding, Lorimer said the company expects a net debt requirement for most of 2026 due to the capital program and seasonal working capital needs, and is in the final phase of agreeing medium-term debt facilities, likely a 2-3-year revolving credit facility. In Q&A, he said the company’s long-term framework includes net debt to EBITDA of “no more than two and a half times,” and characterized this as capacity rather than a target. Based on current EBITDA of “around GBP 80 million,” he said that would imply roughly GBP 150 million to GBP 200 million of “dry powder capacity,” noting deal size would depend on EBITDA contribution from any acquisition.
Sutherland said management is focused on minimizing execution risk through “execution excellence” and step-by-step delivery, while reiterating confidence in growth opportunities—particularly expanding IRN-BRU distribution in England and Wales, where he said A.G. Barr has not “consistently targeted” in the past but is now making “significant distribution gains.”
About A.G. BARR (LON:BAG)
A.G. Barr is a UK-based branded multi beverage business focused on growth and the creation of long-term shareholder value.
Ambitious and value driven, with strong consumer focus, it is a brand owners and builder, offering a diverse and differentiated portfolio of brands that people love.
Established almost 150 years ago in Scotland, now operating across the UK and with export markets throughout the world, A.G. Barr strives to grow its business both organically and through targeted acquisition.
