Strategy and Business Model
Our long-term strategy is to build a sustainable international cider-led, multi-beverage business through a combination of organic growth and selective acquisitions.
The Medium-Term Strategic Goals For The Group Are:
to maintain strong brand market combinations in core geographies through brand and customer investment, by leveraging our brand-led wholesale platforms and developing our high margin premium brand portfolio
to grow our international business through investment in brands and through the development of strategic alliances
to make strategic investments and acquisitions that fuel profitable and sustainable growth and, in the absence of opportunities that complement our strategy or deliver the right risk-return profile, to return cash to shareholders
thus enhancing future earnings growth and maximising shareholder value. We seek to generate high free cash conversion and maintain a sound and efficient balance sheet.
Revenue Generation and Earnings Growth
In our core geographies of Ireland and Scotland, we seek revenue generation through a full-service brand-led wholesale model predominantly focused on brands and customers. In the rest of Great Britain we focus on cider market share expansion and development of a premium LAD portfolio. Internationally we focus on volume growth.
We seek to make brand innovations at low cost and exploit niche and premium markets.
We seek earnings growth through revenue generation, cost control and margin improvement.
Our core businesses are strongly cash generative. We therefore focus on cash. We critically review the value for money of all brand and capital investment. Our current emphasis is on investment at the customer interface to drive revenue. Group management relentlessly drive to reduce costs – in production, distribution and commercial overheads.
We engage with our workforce and incentivise them to ensure alignment with shareholders.
Local management are incentivised with financial targets relevant to their local business unit.
Where necessary, we are prepared to buy in expertise on a margin-sharing basis.
We seek local expansion in our core territories. Potential acquisitions must complement our business and meet our strategic objectives.
We are prepared to make larger transformational acquisitions, and we are ready to seize opportunities as they arise due to the strength of our balance sheet.
We will make disposals where they will enhance shareholder value.
In the absence of capital investment opportunities we will return surplus cash to our shareholders.
Throughout the Group we seek to operate compliantly with the law and as good corporate citizens.
How We Are Configured
C&C has five business segments, which comprise:
This segment includes the sale of the Group’s own branded products in the Island of Ireland, principally Bulmers, Magners, Tennent’s, Clonmel 1650, Heverlee, Roundstone Irish Ale, Finches and Tipperary Water. It also includes the Gleeson beer, wine and spirits distribution and wholesaling business and the AB InBev brands (including Corona) distributed by the Group in Ireland. The primary Irish manufacturing plant is located in Clonmel, Co. Tipperary.
This segment includes the sale of the Group’s own branded products in Scotland, with Tennent’s, Caledonia Best, Heverlee and Magners the principal brands. It also includes the Wallaces Express wholesale business in Scotland, the AB InBev brands distributed by the Group in Scotland and the Group’s share of the Drygate craft brewery joint venture. The Scottish manufacturing plant is located at the Wellpark Brewery in Glasgow.
This segment includes the sale of the Group’s own branded products in England & Wales, principally Magners, Tennent’s, K cider, and Chaplin & Cork’s, and also the distribution of Menabrea. It also includes the production and distribution of private label cider products.
This segment includes the sale of the Group’s cider and beer products in the US and Canada. The Vermont Hard Cider Company manufactures the Woodchuck, Wyder’s and Hornsby’s brands at its cidery in Middlebury, Vermont, which are distributed in North America alongside Magners, Tennent’s and other C&C brands. From March 2016 Pabst Brewing Company will assume sales and marketing responsibilities for the US under a long-term agreement.
This segment includes the sale and distribution of the Group’s own branded products, principally Magners, Gaymers, Blackthorn, Hornsby’s and Tennent’s outside of the UK, Ireland and North America, notably in continental Europe, Asia and Australia. It also includes the sale of some third party brands. The Group operates mainly through distributors in these markets.
Bulmers Ltd of Clonmel, Ireland is not connected with HP Bulmer Ltd of Hereford, UK.
BULMERS® Original Irish Cider is produced by Bulmers Ltd of Clonmel, Ireland and is not sold outside the Republic of Ireland.