Fevertree Drinks shares rise as company stays on track to meet full-year targets

Investing.com - Fevertree Drinks PLC (LSE:FEVR) shares jumped 9% on Thursday after the premium mixer maker reported steady progress in the first half of 2025 and confirmed it remains on track to meet full-year expectations despite ongoing transition challenges in its key U.S. market.

The company reported that its Fever-Tree brand delivered 2% revenue growth at constant currency for the six months ended June 30, while adjusted EBITDA rose 1% to £18.4 million with margins increasing by 20 basis points to 10.7%.

"The transition of the business to Molson Coors is progressing well and despite the complexity of such a transition, it has been particularly encouraging to see the underlying US momentum has been maintained," said Tim Warrillow, CEO and Co-founder of Fever-Tree.

The company’s strategic partnership with Molson Coors, announced in January, grants the beer giant exclusive rights to sell, distribute, and produce the Fever-Tree brand in the United States. The move into Molson Coors’ national network of distributors began in June as planned.

In the U.S., Fever-Tree’s revenue increased by 6% at constant currency, with the brand extending its leadership in both Tonic Water and Ginger Beer categories. However, the UK market saw a 6% revenue decline, reflecting ongoing challenges in the On-Trade channel, though Off-Trade performance remained robust.

The company’s product diversification strategy continues to gain traction, with its broader portfolio beyond tonic now representing 45% of group revenues. Ginger Beer was highlighted as a standout growth driver in Europe, with value up 26% YoY.

Fever-Tree’s cash position strengthened significantly to £130.0 million, up 97% from the previous year, bolstered by strong cash flow and transaction inflows from the Molson Coors partnership.

The company declared an interim dividend of 5.97 pence per share, a 2% increase YoY, and announced a £30 million extension to its share buyback program.

"Together with the operational progress we are making and the strong performance we have seen over the summer months, we are well placed for both the second half of the year and to capture the long-term opportunities ahead," Warrillow added.

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