March 24 (Reuters) – Fevertree Drinks posted a 16% drop in annual profit on Tuesday, reflecting the impact of a disputed 2.8-million-pound (3.76 million) packaging levy and margin pressure from the early stages of its U.S. partnership with Molson Coors.
The company said it launched a formal legal challenge against the UK Environment Agency over Extended Producer Responsibility levy, which Fevertree argues should not apply to certain glass formats sold in bars and restaurants.
Fevertree, which manufactures most of the products it sells in the United States in Britain, signed a distribution and manufacturing agreement with Molson Coors last year to help localise production amid rising tariffs and boost its U.S. sales.
The company reported adjusted core profit of 42.4 million pounds, down from 50.7 million pounds last year. Analysts’ expectations, on average, were at 44.4 million pounds, according to a company-compiled poll.
($1 = 0.7449 pounds)
(Reporting by Yamini Kalia in Bengaluru; Editing by Sherry Jacob-Phillips)
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