ONE MORE THINGMERRION STOCKBROKERS' note on CC Group yesterday will not have done anything to ease the hangover being felt by many investors in the drinks group who have seen the share price collapse from a high of close to €14 last year to €4.98 currently.
Merrion analyst Gavin Kelleher last week surveyed 300 pubs in 11 cities across England and Wales - we presume he did it remotely - and concluded that there is no sign of a recovery in the trade for Magners.
As a result, Mr Kelleher has retained his "hold" rating on the stock with a €5.40 price target. Of the pubs stocking Magners, 50.3 per cent noted no change in demand, while 6.5 per cent said sales of the cider had declined.
The balance noted an increase in sales.
Sixty-seven pubs out of the 208 which said they stocked Magners have introduced new brands of bottled cider within the past year, thereby increasing competition for CC. In addition, 51 out of 88 respondents said they believed Magners wouldn't get close to its bumper 2006 sales levels.
On a positive note, Mr Kelleher found that the majority of pubs that stock Magners and another brand of bottled cider said the Irish brand remains the best seller in the category.
"Given the difficult comparatives in Q1, if no recovery is forthcoming then the risk to numbers is to the downside," Mr Kelleher concluded.
A sobering thought for shareholders, who'll be praying for a swelteringly hot summer.
