Its case has already been covered several times in our columns. Victim of too much competition, and even out of fashion in the UK and Europe, where sales are still down 6% and 12% this half-year, Fevertree had its sights set on the USA.
However, sales there rose by only 7% in the first six months of the year, a sharp decline compared to the same period last year, when sales were up by 32%.
On an annualized basis, operating profit for 2024 would be equal to that of eight years ago. This, while the brand's sales have quadrupled since then. If we were looking for the exact opposite of economies of scale, we'd find them nowhere better than here.
While the Group's balance sheet remains very healthy, it is regrettable that its management did not have the foresight to carry out a capital increase when the company's valuation was reaching new heights.
The only real cause for satisfaction this half-year: the non-tonic beverage range now accounts for 40% of sales, thanks in particular to the success of Fevertree's ginger beer, sales of which are up 19% in a complicated beer market.
In addition, inflation has been contained and margins are expected to improve over the next few quarters, leading to a dividend payout that is also expected to rise. Despite a first-half decline in consolidated sales of 2%, management also foresees a year of growth, with sales up by 4% to 5%.
A certain optimism therefore remains the order of the day, as evidenced by the market purchases of shares by certain directors in recent months. Fans of the genre should keep their eyes peeled for these unit transactions - they could signal a real inflection point.
In any case, the Fevertree precedent could serve as a potential warning to Celsius shareholders, whose stock market track record is furiously reminiscent of that of the British company.
At thirteen times operating profit before depreciation and amortization - or EBITDA - expected this year, Fevertree's enterprise value is moving on its historic lows, far from the ten-year average of thirty-four times EBITDA and even further from the highs of sixty times EBITDA reached in the summer of 2018.
