THE boss of Irn-Bru maker AG Barr has declared consumer tastes, not government regulation, will determine how the business is run as he repeated the company’s criticism of moves to introduce a soft drinks levy.

Roger White was commenting as the Cumbernauld-based soft-drinks giant shrugged off “volatile and uncertain market conditions” to post a 2.7 per cent rise in underlying pre-tax profits to £42.4 million.

Ahead of the expected introduction by the UK Government next year of a sugar tax on soft drinks, the Scottish firm confirmed 90 per cent of its company-owned brands will contain less than 5g of total sugars per 100ml by the autumn.

Chancellor Philip Hammond declared in his Budget speech earlier this month the steps taken by soft-drinks producers to reformulate their products before the levy is introduced had resulted in a “lower revenue forecast for this tax”. But Mr White insisted it is down to consumers to lead the type of products AG Barr develops, not regulators.

He said: “We said at the time [the levy was announced that] we will drive our business based on consumer, rather than on legislators. That’s what we have done.

“We have followed what is going on with the consumer, we have talked increasingly to consumers about what is important to them. And the changes we have made, while not unhelpful from a regulatory point of view, are driven by consumers rather than anything else.”

Mr White noted AG Barr had already been reshaping its portfolio in the last five to 10 years before the sugar tax came into view, citing its acquisition of the Strathmore Water and Rubicon brands, as well its reformulation exiting drinks. He added: “At the end of the day, we are a consumer business and it’s our consumers who should drive our business and nobody else.”

Mr White said the company continues to have regular dialogue with Government officials in an attempt to ensure the levy is “fair and easy to execute”. And he repeated the company’s view that the soft drinks industry had been unfairly “singled out” over the sugar tax.

The government is proposing to introduce two bands of sugar tax, one at 18p per litre for drinks with a sugar content of 5g and over per 100ml, and one at 24p per litre for products with more than 8g of sugar per 100ml.

Mr White said: “We still think it seems somewhat unfair that the government would pick on one specific food group to tax it… outside of taxing other food groups. It still seems unfair, unjust and unreasonable to us that they have pointed their regulatory finger at the one sector that was already doing it.”

Mr White’s comments came as AG Barr delivered a “very solid financial performance” in the 52 weeks ended January 28. It reported revenue up 1.5 per cent to £257.1m and an increase in gross margin of 10 per cent basis points, ending the year with net cash of £9.7m. The company announced a £30m share purchase programme and Mr White noted it was well positioned to consider acquisitions if the right deal came along and to invest in further capital expenditure projects. The major project being undertaken by Barr this year is its £10m investment to add a plastic bottle packing facility at its Milton Keynes site.

A company-wide reorganisation was virtually completed last year, leading to a net loss of 100 jobs and a £3m reduction in overheads.

Mulling the outlook for the current year, Mr White acknowledged the “UK consumer environment remains uncertain”. He added: “We are seeing inflationary pressure as a consequence of sterling’s devaluation coming through. We have taken action ourselves to increase our efficiency and reduce our costs, so that we only have to talk to our customers about minimum levels of pass through of costs. Nonetheless it is happening and we expect that to be a feature of this year.”

The company is proposing a final dividend of 14.4p per share for the year, up eight per cent on last time. Shares in AG Barr closed up nearly four per cent at 568p.