If you’ve been drinking more sparkling water recently, you are not alone.
Fewer people buying bottled water on the go badly impacted sales at major Perthshire employer Highland Spring last year.
But while still water sales sprung a leak, there was real fizz to sparkling sales.
Newly filed accounts for the Blackford business show overall sales fell from £100.5m in 2019 to £88.1m in the year to December 31 2020.
Highland Spring said the results showed “resilience” as consumer habits changed in the pandemic.
These include shoppers reaching for sparkling water bottles as they brought their social pub and restaurant occasions to the home.
Highland Spring sparkling water sales rise
Chief executive Les Montgomery said sparkling water sales have been “more resilient”.
Highland Spring is the UK’s largest sparkling water brand and as overall sales suffered, its sparkling sales rose by 3.6%.
The company’s sparkling water sales are now 17.7% of its plain bottled water sales.
This trend has been reflected industry wide, with analysist Kantar finding take-home sales of plain and flavoured sparkling water grew in value by 7.7% and 12.7% respectively in 2020.
Annual sales of Highland Water products were just under 330 million litres last year.
More profitability on lower water sales
Restructuring efforts narrowed Highland Spring’s pre-tax losses to £1.8m last year compared to a loss of £2.7m in 2019.
Last year the company made around 25 redundancies at its Lennoxtown facility in East Dunbartonshire and a handful at its Blackford site.
During 2020 Highland Spring also discontinued operations at its Speyside Glenlivet bottling plant.
In his report in the company accounts, Mr Montgomery said: “The business had initially recovered from a disappointing 2019 prior to the outbreak of the Covid pandemic.
“However, the impact of the pandemic resulted in a volume shortfall as well as having an adverse impact on sales mix as consumer shopping habits changed with consumption taking place in the home following the closure of hospitality and High Street channels.
“The business took early proactive actions to manage its operations and cost base… and as a consequence was able to increase profitability on significant lower turnover.”
Mr Montgomery, who will step down this year, said he expected the firm to benefit from a wider recovery of the bottled water market.
He said: “Despite a challenging 2020, we remain confident in our long-term approach of continuing to promote the provenance of our brand, providing category leading expertise, focusing on environmental sustainability and ensuring overall value creation
Highland Spring sustainability aims
Highland Spring is placing an emphasis on sustainability in its investments.
These include the construction of a £10m rail siding adjacent to its Perthshire facility.
This will allow it to move goods in a more environmentally friendly way.
The project, to be commissioned next year, will reduce the firm’s carbon footprint by 3,200 tonnes.
The company aims to be net carbon zero by 2040.
It is also experimenting with new packaging formats that are 100% recyclable.
