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AG Barr sees revenue improving after festive cheer

A bottle of Irn-Bru is seen in Edinburgh, Scotland in this May 2, 2014 file photo. REUTERS/Suzanne Plunkett/Files

(Reuters) - AG Barr (BAG.L), the maker of Irn-Bru and Rubicon fizzy drinks, said it expected fourth-quarter revenue growth in excess of 2.5 percent, after a robust performance in the Christmas period.

The Cumbernauld, Scotland-based soft drinks maker said its trading strategy and brand execution helped it offset a challenging and highly competitive UK market.

Soft drink makers around the world such as PepsiCo and Coca-Cola Co have been introducing beverages with less sugar and more natural ingredients as consumers turn calorie-conscious and opt for products perceived as healthier.

Barr, whose Irn-Bru fizzy orange drink outsells Coca-Cola in Scotland, bought cocktail mixer business Funkin last year for about 21 million pounds, to expand its drinks portfolio.

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The firm's main rival in the UK is Britvic (BVIC.L), which makes Robinsons squash and Tango, said in November it expected full-year 2016 profit growth after a slow start to the year.

"In a challenging market, Barr has delivered the improved second half we hoped to see. Growth returned, rounded off with a soundly executed Christmas," analysts at Investec Securities wrote in a note.

AG Barr said on Friday it now expects revenue for the 53 weeks ending Jan. 30 to be around 257 million pounds. It reported revenue of 260.9 million pounds last year.

Analysts expect the company to report a full-year pretax profit of 41.39 million pounds on revenue of 260.11 million pounds, according to a Reuters estimate.

(Reporting by Aastha Agnihotri in Bengaluru; Editing by Sunil Nair)