Mixer-maker Fevertree has warned annual profits will be lower than previously expected after the Ukraine war pushed up commodity prices “dramatically”.

The company said the surge over recent weeks had created “significant uncertainty in relation to input costs”.

That means underlying earnings for the year are expected at £63m-£66m, down from previous guidance of £69m-£72m.

The guidance was described as a “precautionary step in response to a seismic global shock”.

Shares slumped by 8% in early trading, leaving them more than 40% lower for the year to date.

Fevertree is one of the first consumer-facing UK-listed companies to quantify the financial hit from the volatility that has buffeted markets since Russia’s invasion of Ukraine.

Prices of commodities from oil and gas to nickel and wheat have soared, adding to inflation pressures across businesses – even those not directly trading with either of those two countries.

Boris Johnson arrives in UAE in bid to end West’s ‘addiction’ to Vladimir Putin’s oil and gas

‘Despicable’ companies fined for ‘predatory’ and ‘coercive’ calls to sell unnecessary insurance to elderly

Ukraine war: UK bans luxury goods exports to Russia and hikes import tariffs on products – including vodka

Wagamama owner The Restaurant Group, which also published results on Wednesday, said it was “mindful” of similar pressures though has not changed its financial guidance.

Fevertree’s update showed pre-tax profits for 2021 climbing by 8% to £55.6m with sales rising 23% to £311m.

Please use Chrome browser for a more accessible video player

The company was already battling what it described as “unprecedented” supply chain disruption which resulted in a squeeze on its profit margins and a “global backdrop of inflationary pressures” even before the war.

It has taken action to try to mitigate some of the problems, which include lorry driver shortages, soaring transatlantic freight charges and US storage costs.

But it is now facing a further challenge as “commodity prices have increased dramatically in recent weeks because of the terrible events unfolding in Ukraine and this has created significant uncertainty in relation to input costs”.

However, Fevertree still expects to deliver sales growth of around 15% this year and hopes to benefit from a sustained shift towards drinking premium cocktails at home.

The Restaurant Group, owner of brands including Wagamama and Frankie & Benny’s, pointed to similar pressures as it delivered an update on Wednesday.

In its case, the company is not changing its financial guidance for the year but said it was “mindful” of the inflationary impacts of the Ukraine war and was working on contingency plans if there the conflict has any effect on its supply chain.

It said it had already been facing cost inflation of 5% even before the war, with higher electricity and gas prices adding up to a £6m-£7m hit.

Chairman Ken Hanna said: “While we have no direct exposure to either Ukraine or Russia, it remains too early to assess the impact on supply chain costs and customer behaviour.”

TRG’s shares surged 10% higher in early trading as investors cheered its wider update, showing that annual losses narrowed to £32.9m compared with £132.9m a year earlier.

The group said current trading was strong, with sales for Wagamama up by 21% in the eight weeks to 27 February compared with 2019 levels.

Related posts:

UK economy to face ‘enormous strains’ following lockdown, says Sunak Fears offshore oil and gas workers may lose jobs in transition to green energy Easyjet says fewer than half of summer trips sold as customers leave it late Asda targets Fat Face chief Evans as boss of fashion brand George Greenpeace loses legal battle to revoke BP permit for oil field in North Sea Google to ban ads and demonetise YouTube videos promoting climate change denial Bank of England warns over threat of sharp market fall, amid economic jitters ASOS shares plunge as supply chain strains darken sales and profit outlook SoftBank boss confident big bets can pay off again despite several ‘golden eggs’ dying Campaign to stop LV= takeover by Bain gathers pace ahead of vote deadline Insurance unicorn Marshmallow faces further legal battle over IP ‘misuse’ JD Sports and Footasylum fined £4.7m for secret meetings