Soft drinks group AG Barr has announced plans to phase out its Strathmore water brand, a move that could result in the closure of its Forfar production site and put 23 jobs at risk.
The decision, revealed alongside its annual financial results, is subject to employee consultation. The company said Strathmore has struggled to stay competitive in recent years, leading to the conclusion that the Forfar operation is “no longer sustainable.”
A spokesperson stated: “The proposals are subject to consultation, and we intend to fully support our employees through this period of change.”
The announcement came as AG Barr posted a 15.8% rise in adjusted pre-tax profits to £58.5m for the year ending 25 January 2025. Revenue increased by 5.1%, driven largely by a strong performance across its soft drinks portfolio, with standout growth from Rubicon and Scotland’s iconic Irn-Bru.
Statutory pre-tax profits stood at £53.2m, after accounting for £5.3m in one-off costs linked to the closure of a direct sales operation and the integration of the Boost brand.
Chief executive Euan Sutherland said the group’s refreshed strategy, which includes the integration of Barr Soft Drinks and Funkin into a single streamlined operation, is already delivering results. “Looking forward, we have a refreshed strategy centred on growth and are committed to our long-term financial targets,” he added.
The group also reported a healthy cash position of £63.9m and confirmed it is on track with its strategic programme to rebuild operating margins. Adjusted operating margin rose 130 basis points to 13.6%.
AG Barr will outline further details of its strategy at a capital markets event in London on 3 June. The next trading update is expected on 29 July.
Zoe Gillespie, investment manager at RBC Brewin Dolphin, noted the move to discontinue Strathmore is unlikely to significantly impact the business. “With plenty of cash in the bank and an appetite for acquisitions, it seems that another strategic move could be in the offing in the not-too-distant future,” she said.
