Irn Bru-maker AG Barr turns to marketing and developing low sugar drinks following budget bash
The chief executive of AG Barr has stated new plans to “substantially” reduce the portfolio’s sugar content, as well as “brand strength” and “consumer-driven innovation”, will override any negative effects the forthcoming soft drinks tax will have on the company.
According to Roger White, the brand will also focus its marketing efforts on its lower and no-sugar products, following the chancellor’s budget plans to add an extra levy on high-sugar soft drinks from April 2018.
The comments were made in the group’s financial results for the year end 30 January. AG Barr, which produces and markets drinks such as Irn Bru and Rubicon, saw its statutory profit before tax increase by seven per cent to £41.3m, up from £38.6m in 2015.
However the brand’s share in the UK dipped slightly to £249.4m, down from last year’s £253.7m.
In contrast to the angry reactions from the Food and Drink Federation, White added an aura of calm and positivity to the sugar tax debate, stating he believes “at least two thirds” of the AG Barr portfolio would not incur the extra fee due to their low-sugar credentials.
He said: “The development of our existing soft drinks portfolio will continue to be a key area of our strategic focus. To ensure success in the UK market we are focusing our marketing efforts on our ‘lower’ and ‘no’ sugar products and are substantially reducing the sugar content of our portfolio to reflect consumers' changing preferences.
“We have already made significant progress in this area, reducing the average calorific content of our company owned portfolio by 8.8 per cent in four years, and we anticipate the scale of this change to accelerate over the next year as we reduce our overall exposure to high sugar products where appropriate.”
White added: “For the balance of our portfolio, which would attract a levy, we anticipate that brand loyalty and consumer preference will drive continued demand. We will, of course, play an active role in the consultation between the Government and the soft drinks industry on the proposed levy, and are fully committed to working towards an outcome that benefits consumers, shareholders and other stakeholders.”