DAVY VIEW

The post-lockdown environment marks a new phase for C&C. While the old Matthew Clark Bibendum (MCB) playbook remains relevant, the next phase is likely to require an acceleration of operational and strategic developments, including downstream market share gains, supply chain interconnectivity and the adoption of more holistic solutions at Matthew Clark (e.g. draught). We conclude that the next phase will advantage traditional brands and scale players, with route to market platforms remaining integral. With the demand backdrop in the on-trade set to adjust (profit pool contraction), we do not believe the opportunity set for the group and its new CEO has diminished. We continue to recommend the shares.