Britvic makes iced coffee and energy drink acquisitions
Jimmy’s Iced Coffee targets a ‘highly appealing consumer brand in a strongly growing market segment’. In Brazil, the acquisition of Extra Power will help the company extend its brand portfolio and regional footprint in the Center-West.
“These transactions are aligned to our strategic priorities and provide further growth opportunities to accelerate our strong growth trajectory,” says the company, which also announced ‘robust’ Q3 performance with 9.9% revenue growth in the quarter compared to the prior year.
Iced coffee trends
The UK ready-to-drink iced coffee category is both large and fast-growing, with a retail sales value (RSV) of £280m last year, an annual increase of 15.3%, according to IRI data.
Founded in 2010 by Jim Cregan and sister Suzie Owen, Jimmy’s Iced Coffee is the fastest growing brand in the segment, thanks to its ‘uplifting brand personality, refreshing range of products, differentiated packaging and multi-channel presence’.
With more than 10,000 distribution points, a Jimmy’s iced coffee is sold every 2.5 seconds. In the year to June 2023, Jimmy’s Iced Coffee generated a retail sales value of £17m, +43% on the previous year.
“We intend to further accelerate the growth of Jimmy’s through the utilisation of Britvic’s market-leading customer relationships to drive new listings and increase distribution, while increasing cost efficiency through Britvic’s supply chain expertise and procurement capability,” notes Britvic. “Jimmy’s is well aligned to our Healthier People, Healthier Planet pillar, with lower calories per serve than the category average, fully recyclable packaging and compliance with HFSS legislation.”
Jimmy’s Iced Coffee founders will continue to be involved in the business as ambassadors for the brand, helping to support the transition while providing advice on brand direction and future innovation.
Jim Cregan, Co-founder of Jimmy’s Iced Coffee says: “We are so delighted with this deal which is the culmination of twelve years of monumental hard work by my sister and I. We have poured our heart and souls into making this business what it is today and we feel so fortunate that Britvic is now able to take Jimmy’s to places about which we could only dream. We are excited to watch the next chapter of the journey unfold and look forward to Jimmy’s Iced coffee becoming even more well known and enjoyed.”
Growing in Brazil
The acquisition of the Extra Power energy brand from GlobalBev marks an ‘important extension’ of Britvic’s Brazilian operations.
Britvic entered the Brazilian market in 2015 with the acquisition of Ebba, followed by the acquisition of Bela Ischia in 2017. In the financial year 2022, Britvic generated £143m of revenue in Brazil (accounting for around 10% of the group’s total £1,618m that year).
“With 42% market share in its core regions near Brasilia, Extra Power enables access to the fast-growing, high-margin energy category,” says Britvic. “The transaction also includes a modern, efficient warehouse in Brasilia, which will enhance our supply chain efficiency across our wider portfolio and route to market into the Centre-West region (Distrito Federal & Goias).”
In the year to December 2022, the portfolio generated R$118m (£19.3m) of net sales, growing 26% on the previous year.
Simon Litherland, Chief Executive Officer commented: “I am delighted by this acquisition, which enables us to enter the higher-margin energy category in Brazil. In line with our strategy to accelerate and expand our presence in the country, we will access a growing category, extend our regional presence and deliver efficiencies in our supply chain. I am confident this acquisition will accelerate our growth trajectory in one of our key markets and generate great value for our business.”
Britvic in Brazil
Britvic's key brands in Brazil include Maguary, Dafruta and Bela Ischia.
In some cases, the company's experience in the UK has helped it innovate in Brazil.
The Maguary brand heritage dates back to 1953 and, similar to the European flavour concentrates brands, is consumed by families at home. This awareness enabled Fruit Shoot to be launched in Brazil as Maguary Fruit Shoot – following the same principle Britvic has followed in Europe - where Robinsons and Teisseire are the halo brands. The brand has also launched a plant-based chocolate drink.
New category launches in recent years have included Puro Coco and Natural Tea, both of which are ready-to-drink formats in the coconut and iced tea categories.
Dafruta Tropical was launched in the flavour concentrates category, utilising the technical know-how of the Robinsons formulation. This new range uses real fruit, has a range of flavours and is pre-sweetened, differentiating it from the traditional concentrates in Brazil which require sugar to be added by the consumer. More recently the portfolio has expanded with the launch of Britvic Mixers and the premium Mathieu Teisseire range of concentrates for cocktails.
The growth market for fruit drinks in Brazil is complemented by Britvic’s fruit growing and fruit processing company, Be Ingredient, providing natural ingredients for Britvic and the international market.
