Hello everyone, and thank you for joining the Fever-Tree full-year results presentation. My name is Sammy, and I'll be coordinating your call today. During the presentation, you can register a question by pressing star followed by one on your telephone keypad. If you change your mind, please press star followed by two on the telephone keypad to remove yourself from the question queue. I will now hand over to your host, Tim Warrillow, co-founder and CEO of Fever-Tree to begin. Please go ahead.
Thank you, and good morning everyone, and thank you for joining us to hear about Fevertree's performance in 2024. My name is Tim Warrillow, co-founder and CEO of Fevertree, and I'm joined on the call by Andy Branchflower, CFO. This morning, we'll be talking about the brand's performance during 2024, how the global opportunity for the Fever-Tree brand continues to expand and evolve, as well as the transformational partnership we've entered into with Molson Coors in the U.S.. There are three important things we want you to take away from today's presentation. Firstly, that the global trends in the beverage sector are firmly in Fevertree's favor, and we believe that we're uniquely positioned to take advantage of all of the trends across adult socializing, from traditional mixing to lower ABV to non-alcoholic options.
Secondly, we will be re-emphasizing the importance of our long-term strategic partnership with Molson Coors and how it provides a platform for significant revenue and profit growth in the medium and long term. Thirdly, as a result of this new partnership, Fever-Tree not only has a greater revenue opportunity but a significant level of guaranteed U.S. profits and lower working capital requirements, which will all lead to increased quality of earnings and cash generation. As a result of this, this morning we're announcing the expansion to our initial buyback program of GBP 29 million subject to shareholder approval, taking the total to GBP 100 million for the year. Over the page. Looking back over 2024, Fever-Tree continued to gain share across our key markets as the brand grows in strength around the world.
In the U.S., our largest revenue-generating region, the brand delivered double-digit growth at constant currency and outperformed the mixer category, extending our number one share in the ginger beer and tonic categories for 32% and 27% respectively. In the U.K., Fever-Tree remains the number one brand by value by significant margin, despite continued gin declines impacting the tonic category. We've been focused on diversifying our portfolio to cater to the greater variety of drinks being consumed, and as a result of this focus, our non-tonic products now comprise almost 30% of our total U.K. sales. Europe had a tough first half of the year with unfavorable weather during the period. However, the brand bounced back strongly, delivering growth of 12% at constant currency in the second half of the year.
We remain the largest premium mixer brand across Europe, extending our value share as we continue to grow ahead of the competition, as well as driving growth of the ginger beer category. Finally, in the rest of the world region, we delivered 22% year-on-year growth at constant currency, driven by continued share gains in our two largest markets in the region, Australia and Canada. Turning to the future opportunity, we continue to see consumer trends evolve and develop across the adult socializing spectrum. Spirits continue to take share from wine and beer, and this is being largely driven by the growing premiumization of the long mix drink, a drinking trend that allows spirits to be enjoyed on more occasions throughout the day.
This trend lends itself perfectly to the continued growth of our core mixer range, where we still have a lot of white space to penetrate around the world. In addition, we're seeing the trend for drinks with lower ABV and lower calories starting to really gain traction, once again a trend that is dependent upon mixers. Finally, the desire for sophisticated non-alcoholic drinks is no longer a niche category. In the last few years, it has really started to gain wide-scale consumer and trade attention, and this is another trending category that Fever-Tree is uniquely positioned to play an important role in. Looking at each of these trends in turn, what is so exciting is that there is no brand better positioned to satisfy consumers' new and evolving expectations than Fevertree.
The brand's strong credentials as a sophisticated, high-quality product are positioned as the number one premium mixer globally, and our unmatched range of products makes us uniquely placed to benefit from the growing range of mixing occasions, as well as expand our reach into standalone opportunities as a sophisticated soft drink or non-alcoholic alternative. Furthermore, Fever-Tree's global distribution focus on not just the off-trade but also the on-trade means it is uniquely placed to target the full range of adult socializing occasions. It is this unique position at the heart of so many of these adult trends that has led to the transformational partnership with Molson Coors that we announced just a few weeks ago.
This exciting partnership will allow Fever-Tree to unlock the next phase of our growth in the U.S. market, where we still have an enormous runway ahead with our core mixers, not to mention the opportunity once we take into account product extensions and additional channels the brands will be able to access in the future. Crucially, the strategies of the two businesses are clearly aligned, ensuring that Fever-Tree is a priority brand within Molson Coors' total beverage ambitions, as both businesses are committed to driving the brand's opportunity across alcoholic and non-alcoholic categories. This commitment and execution will be supported by a substantial incremental marketing fund, providing the firepower to further drive brand awareness. Finally, they will manage the onshoring of local US production to enable Fever-Tree to capitalize on Molson Coors' supply chain and procurement strength and expertise to drive operational efficiencies.
Alongside increasing and accelerating the U.S. opportunity for the Fever-Tree brand, the partnership with Molson Coors will drive a step change in Fever-Tree's quality of earnings going forward. As we drive that opportunity, Molson Coors' operational expertise and economies of scale will increase profitability and reduce volatility, all underscored by guaranteed levels of royalty fee, which materially de-risk Fevertree's U.S. profit trajectory over the medium term. Because Molson Coors will fund the working capital required to drive U.S. growth, Fever-Tree will convert U.S. profits into cash highly efficiently. This reduces the cost of U.S. growth and will in turn further strengthen our balance sheet, creating incremental firepower to drive the global opportunity for the brand alongside the potential for further shareholder distributions.
Before I hand over to Andy for the financial review, I'd like to update you on our progress as part of our ESG agenda, where we're driving action across the full ESG spectrum, including developing our first net-zero roadmap and our first global packaging footprint analysis, alongside continuing our funding efforts for Malaria No More and supporting our colleagues through a range of DEI events, employee resource groups, and training initiatives. I will now hand over to Andy to take you through the financial review.
Thank you, Tim, and good morning everyone. The group delivered 4% constant currency growth for the Fever-Tree brand, which translated to a 66% increase in Adjusted EBITDA on the back of a strong margin recovery, whilst working capital optimizations drove a 150% operating cash flow conversion, resulting in a 60% increase in net cash to GBP 96 million. Turning the page. Gross margin continued to improve as we progressed through the year, driven by recovering glass costs, recalibrating transatlantic freight costs, and net pricing actions taken with customers across our regions, underlining the continued progress we are making in margin recovery. Looking forward, we have local bottling currently coming online in Australia, and we will continue to optimize our existing bottling footprint, drive procurement efficiency, and technical optimization initiatives, all leveraging the investment we have made in recent years in our technology platform.
Whilst geopolitical and macroeconomic uncertainty remains elevated, we remain focused on driving continual improvement across our operations. Our global supply chain capability, procurement processes, and operating business models have improved significantly following our hard work and investment in recent years, and the Molson Coors partnership will only further strengthen this position. As flagged in the release, the group incurred GBP 5 million of exceptional costs. The majority of these related to the exit from our primary U.S. bottler ahead of entering the strategic partnership with Molson Coors, alongside advisory fees incurred in respect of the transaction. Turning the page, we delivered strong operating cash flow conversion of 150%, reflecting a notable improvement in working capital as we optimize inventory levels, leveraging our new ways of working and technology platform.
As such, cash increased by 60% to GBP 96 million, and we're recommending a 2% increase in our final dividend, whilst also extending our current share buyback program to GBP 100 million, which we expect to return to shareholders over the course of this year. Turning the page, I'm going to briefly recap some of the key aspects of the Molson Coors partnership and transaction, as announced in January. Sitting at the heart of the strategic partnership is a license agreement between Fever-Tree and Molson Coors. Under the agreement, Molson Coors will be responsible for the sales, distribution, marketing execution, and production of Fever-Tree in the U.S., whilst Fever-Tree retains full control of brand identity, vision, and the development of new products for the U.S. market.
The partnership will be managed by a joint governance committee made up of both Fever-Tree and Molson Coors' senior management, which will oversee all key elements of the arrangement, including annual and strategic planning, decisions on marketing investment levels, and product strategy. The transaction included the sale of our local U.S. trading entity, Fever-Tree USA, to Molson Coors to allow for the transition of working capital, employees, and operations under the partnership. Alongside this, Molson Coors acquired an 8.5% shareholding of Fever-Tree, issued for cash consideration of GBP 71 million. This investment demonstrates both Molson Coors' commitment to the partnership and their belief in the opportunity ahead, and will underpin the long-term relationship between parties. Under the license agreement, the partnership P&L will sit within Molson Coors' financials rather than Fever-Tree's.
As we set out in this slide, Molson Coors bring operational capabilities and economies of scale that will unlock significant incremental U.S. profitability over time. The main driver of this improvement will be the onshoring of U.S. production over the initial years of the partnership. Once delivered, this will drive underlying product cost improvements and reduce exposure to transatlantic freight costs. With regards to tariffs, were they to be levied, whilst there could be an impact on the partnership P&L in the short term, we're confident that the onshoring of production and the guaranteed profit mechanism will materially mitigate any impact from 2027 onwards. The partnership will also leverage Molson Coors' logistics scale, marketing buying power, and national sales teams.
Therefore, as the U.S. business scales, we should see a step change in levels of profitability made by the Fever-Tree brand in the U.S., and the profits generated by the partnership will be shared based on the contractually agreed formula whereby both parties will receive a broadly equal share of profits. Fever-Tree will recognize their share of the partnership's profits via a royalty fee, and crucially, Molson Coors have agreed to guarantee an absolute level of these royalty fees over the period from 2026 to 2030, underlining their confidence in the opportunity. Reflecting the still early stage in the U.S. transition, our outlook remains unchanged from January. In order to unlock the sustained long-term benefits of the U.S. partnership, we need to invest for growth in the near term.
From a revenue perspective, it's prudent to assume that the transition of the U.S. route to market could impact U.S. revenue growth in 2025. However, from 2026 onwards, we expect U.S. revenue growth to rebase to a much stronger trajectory over the medium term. That revenue growth will be fueled by the deployment of an incremental marketing fund in the U.S., which will temporarily offset strong underlying EBITDA margin growth. Following this initial period of transition and marketing investment, we're confident that the benefits of the partnership with Molson Coors will drive a sustained uplift in the group's revenue and EBITDA growth, positioning Fever-Tree to continue to deliver a high quality of earnings over the medium term.
Which, as this slide sets out, means that strong revenue growth driven by US acceleration converts to even stronger EBITDA growth driven by Molson Coors' operational capabilities and economies of scale, all underpinned by guaranteed profit levels, and that well-underpinned EBITDA growth then converts to even stronger cash generation as U.S. working capital requirements fall away for the group. In so many ways, the Molson partnership is a demonstration of the true underlying value of this business, where the Fever-Tree brand and its unique position and relevance within evolving drinking trends across alc and non-alc occasions globally can combine with the asset-light business model to drive a virtuous circle from revenue growth to cash.
Whilst we will ensure we retain sufficient funds to fuel global growth opportunities, any excess cash generated over the medium term by our asset-light cash compounding business model can be returned to shareholders, as demonstrated by the announcement today to extend the current share buyback program by a further GBP 29 million, resulting in up to GBP 100 million returned to shareholders this year. With that, I will pass back to Tim.
Thank you, Andy. Right, over to the strategic update. Fever-Tree had another successful year in the U.S., delivering revenue of GBP 128 million, which is 12% growth on a constant currency basis. Fever-Tree continues to significantly outperform the competition, both premium and mainstream, with particularly strong market share gains in tonic and ginger beer over the last four years, almost doubling our value share in both categories to hold 27% value share in the tonic category and 32% in ginger beer. Over the page. Looking forward, we are excited about our future growth prospects following the announcement of our strategic partnership with Molson Coors. As this slide demonstrates, Molson Coors, with its broad multi-channel approach across both on and off-trade channels, makes them the perfect partner for the Fever-Tree brand. In headline numbers, their network covers over 500,000 accounts and makes 30,000 deliveries every single day.
That network is supported by dedicated national sales force, best-in-class category management, and long-established customer relationships and deep sales insights. It is these capabilities that will combine to accelerate our growth and expand our U.S. addressable opportunity. Within Fevertree's core U.S. premium mix opportunity, there remains significant white space across the on-and-off trade in both the number of accounts the brand is currently in and the number of Fever-Tree products per account. The initial business case we built with Molson Coors will leverage their distribution platform, their customer relationships, and their category management capabilities to increase both distribution breadth and depth.
We will then further compound growth by driving an increased rate of sale of products in those stores and on-trade outlets, whether through leveraging merchandising capabilities at point of sale, increasing off-shelf space for the brand, or by increasing brand pull as we make a step change in U.S. marketing investments. It is this revenue growth multiplier effect which underpins an ambitious initial plan, and this is before we consider the potential for incremental innovation-led opportunities that the Molson Coors platform is perfectly positioned to execute against, such as non-alc or RTD. In summary, this is why we're so excited about the road ahead for Fever-Tree in the U.S. and why we believe this partnership will be truly transformational.
While it is early days since the announcement, good initial progress is being made, and underlying brand momentum remains very strong. We look forward to embedding the partnership and working with Molson Coors in the coming months to fully transition Fever-Tree into their business. Moving to the U.K., Fever-Tree delivered GBP 111.1 million revenue in the U.K., a decrease of 3% year-on-year following a period impacted by low consumer sentiment, especially in the on-trade, as well as a declining gin category. However, we had a much more positive second half of the year, including a return to growth in the off-trade, and continue to outperform the competition to retain our position as the number one mixer brand by value by a significant margin. Importantly, we remain focused on diversifying our portfolio beyond tonics to cater to a greater variety of drinking occasions.
Our non-tonic sales have increased by 14% CAGR over the last five years and now represent almost 30% of our total U.K. sales. This year, we continue to see good performances from our cocktail mixes and our adult soft drinks range, alongside one of our most recent product additions, Pink Grapefruit Soda, which grew strongly as we capitalized on the increasing popularity of premium tequila and the Paloma serve. In the U.K., our most mature market, Fever-Tree has already built an unrivaled portfolio catered to a broad range of mixing occasions across a growing number of spirit categories. We have a very high level of brand awareness and strong brand credentials, which means that Fever-Tree is by far the brand best placed to satisfy consumers' desire to socialize with sophisticated drinks across the alcoholic and non-alcoholic spectrum.
In addition, it opens up exciting opportunities to work with brands across the beverage industry, from traditional spirit and mixer combinations to wine spritz and lower alcoholic options. The most recent example of this is our new Blood Orange Spritz RTD in conjunction with Papa Salt, a fast-growing gin brand owned by Margot Robbie and her co-founders, where we have created a refreshing serve in a 250 ml can with only 107 calories and 5% ABV. The product will officially launch in U.K. supermarkets in March in time for summer months when lighter spritz serves start to become popular.
As I hope these two slides demonstrate, despite another year with a tough macro backdrop, the brand continues to be the mixer choice in the U.K. with a higher value share than other brands by significant margin and is best placed to capitalize on the latest consumer trends as sentiment improves. Turning to Europe, the Fever-Tree brand delivered GBP 97.7 million revenue, which was flat year-on-year at constant currency, following a significant acceleration of 12% growth at constant currency in the second half of the year, helped by the phasing of orders which moved into July and August. Fever-Tree performed well against competition, growing value share of total mixers by 0.6 percentage points and our share of premium mixers by 1.9 percentage points as we continued to outperform and drive growth of the category.
Consequently, we finished the year with our highest ever value share of the total mix category at 15.8% and now hold over two-thirds value share of the premium mix category across European retail. Over the page. In a similar way to other markets, the strength of the Fever-Tree brand across Europe is also extending into categories beyond tonic. Ginger beer is the best example of this as we gained another 3.5 percentage points of share this year to reach 38.6% value share of the category across European retail, almost double the next largest ginger beer brand.
We're well aware that consumption of our ginger beer, as well as some of our sparkling range, spanned both mixing and soft drink occasions, so this year we capitalized on this versatility and launched 250 ml cans of ginger beer and sparkling grapefruit in Benelux and Switzerland as an on-the-go adult soft drink option for consumers. We supported this launch with Fever-Tree branded fridges at a number of locations such as convenience stores and travel hubs to enhance the brand's visibility and extend its occasionality and look to extend this format to more European markets in 2025. Overall, while the first half of the year presented a challenging backdrop, the brand performed well in the second half of the year, which, along with the continued strength of the brand across a broadening range of products, gives us optimism for future success in this region.
Our final region is Rest of the World, where Fever-Tree delivered GBP 32.2 million revenue, a 22% increase year-on-year at constant currency. This strong growth is due to a combination of good underlying brand performance as well as lapping of a prior year inventory buyback as we transition the Australian market to a new subsidiary setup. Our two largest revenue-generating markets within the Rest of the World region are Australia and Canada, both of which saw share gains during the year. In Australia, Fever-Tree continues to grow ahead of the total mixer category, driven by our soda range, with our new 250 ml cans also helping to drive growth. In addition, we launched three cocktail mixes during 2024, which have got off to a good start as we broaden our portfolio to cater to the latest drinking trends.
In Canada, Fever-Tree grew its value share by 2% year-on-year and contributed more value growth to the category than any other brand. Our cans have been a significant contributor to our growth this year as we see the popularity of this format increase, mirroring the success we've had from our cans in the U.S. market. In summary, I'd like to finish where I started by summarizing the key messages I want you to take away today. Firstly, that the global trends are firmly in Fever-Tree's favor, and we believe that we're uniquely positioned to take advantage of all of the trends across adult socializing, from traditional mixing to non-alc options.
In the U.S., our strategic long-term partnership with Molson Coors will not only provide the platform for significant revenue and profit growth in the medium term, but will also lead to increased quality of earnings and cash generation for the group. As a result, this morning, we are announcing our intention to extend the initial program by GBP 29 million, subject to shareholder approval, taking the total to GBP 100 million for the year. Thank you for listening this morning. Andy and I are now very happy to answer your questions.
Thank you, Tim. To ask a question, please press star followed by one on your telephone keypad now. If you change your mind, please press star followed by two to remove yourself from the question queue. When preparing to ask your question, please ensure your device is unmuted locally. We have a question from Edward Mundy from Jefferies. Your line is now open.
Morning, Tim. Morning, Andy. Three questions, please. The first is around the guaranteed level of royalty fees and the fact that the EBITDA margin of the partnership P&L should also increase as you get more scale and after that initial period of investment. I think if you look at Molson Coors' U.S. beer business, they've got an EBITDA margin in the 20s. Is there anything structural that would prohibit you from achieving a similar type of margin when the business is in full throttle? That's the first question. The second question is really around cash and as you think about the optimal capital structure, given that the deal step changes your ability to generate cash, but it also de-risks your business to a large extent.
You're currently running with a cash balance, but does this deal change the way you think about your optimum capital structure when thinking about shareholder distributions? Could you potentially start to end up with some debt on your balance sheet as opposed to currently running with a cash position? The third question is around innovation. Tim, I think you shared some quite interesting innovations coming through. It'd be interesting to see how busy the team are. Is the focus really on extensions of existing products or thinking about new products and categories to tap into?
Thanks, Ed. I'll take those first two. I think, look, on the levy profit note, there's no structural thing. There's nothing structural that would prevent, certainly, the partnership from delivering very strong EBITDA margins. Then our share, Fevertree's share of those profits, also delivering EBITDA margins in line with the numbers you quoted there. I think from a cash perspective, as we spoke before, we retain significant levels of cash in the business to drive growth. We always have, and that remains our priority. The Molson deal takes away the need for cash to drive the U.S. opportunity because Molson will ultimately be carrying the working capital. In the instance of the upweighted market investment, they will be the ones deploying the cash to drive the opportunity. Therefore, it does change our cash requirements for the group because we only need cash to drive the non-U.S. opportunity.
Certainly, we have that in mind in terms of the level of cash we need to hold and the opportunity to return excess cash to shareholders as we generate that over the coming years by virtue of that compounding effect we have described in the presentation of, once we are through this transition year, very strong revenue growth translating to even stronger EBITDA growth and then even stronger operating cash flow generation. Your question about debt, that is not something we are considering in terms of the structure of the business. No, we are not looking to change that.
Ed, in answer to your question about innovation, look, I mean, I think it's fair to say we've got more going on in the innovation pipeline than ever. This is reflective of the way the drinks opportunities are opening up, which I hope I described in the presentation just now. I mean, as you would know, Ed, the spirit companies are all turning their attention to how to encourage people to drink their drinks long, which ultimately means mixed. There are more and more opportunities opening up across more spirit categories for us there. There is also this big move and desire to move into lower ABV, lower calorie drinks, which again requires mixing. Of course, there is increasing interest in non-alcoholic and sophisticated soft drink options. All of these categories and areas suit the Fever-Tree brand beautifully.
As the market leader, we sit here in this very enviable position where a lot of companies come to us to talk about wanting to develop products together. At the same time, retailers around the world are offering us shelf space to launch new products into these categories. As a result, we're pretty busy on the innovation front. There are some very exciting projects we're working on. I just mentioned our latest launch with our Papa Salt RTD, which is in support of the spritz launch that we announced last year with our Rosé business. This is a growing spritz range, which we're excited about. There's also our sort of first move into, if you like, sort of a classic RTD, which is another area that we think has enormous opportunity for the brand going forward.
A lot going on and a lot of opportunity ahead.
Very good. Thanks.
We now have a question from Anubhav Malhotra from Panmure Liberum. Please go ahead.
Hi, Tim. I've got three, if you don't mind. We firstly touch on the gross margin expectations for the next year. I know how you'd be reporting will not be able to see the gross margin progression properly because of the way the deal with the U.S. fund works. Maybe for the rest of the business, what are your expectations on gross margins and what sort of rates on energy and glass have you been able to secure there? I think that matters for the U.S. business as well since you will be supplying a lot of the production from the U.K. to the U.S., for now at least. Secondly, on Europe, I mean, I noticed you already have two-thirds of the premium mixer category there in terms of market share. You grew market share, but sales were still in decline.
Are you worried that the premiumization trend in the mixer category is not progressing as well as you would have hoped in terms of the opportunity in Europe? Is it more a case similar to the U.K. now where it will have to be driven by other categories beyond mixers in terms of growth? This last one on the non-alcoholic trend, I know you had launched with Papa Salt in alcoholic RTD, but are you considering non-alcoholic RTDs with brands maybe such as Seedl ip, or is that something too early now? Thank you.
Yeah. I'll take the first question on gross margin. Yeah, look, in terms of how we think about gross margin for the non-U.S. part of the business in 2025, look, you can see the trajectory of gross margin since we put it in the slide since the first half of 2022, really, in terms of the reduction and the steady incremental improvement. I think as we look into 2025, we've secured further improvement in glass costs underpinned by improving energy levels, which we've hedged for this year. We've seen other improvements in other categories like sugar. We're taking pricing actions with customers again. We're continuing to drive all of those technical optimization projects, which we've spoken about over the last couple of years. Pre-announcing the Molson Coors deal, we talked about confidence in delivering a 200 basis point improvement in margins kind of year-on-year for the group.
That hasn't changed for that non-U.S. part of the business, if that's helpful.
Just quickly on Europe, the sales, as we say, were flat in Europe, but actually, they grew encouragingly in the second half. We are not concerned that the mixer category is going backwards. We have still got a lot of white space there. Whilst, as you rightly say, we have got sort of two-thirds of the market share in the premium category, we are currently 16% of the overall category. We see real opportunity to grow and drive that with new distribution opportunities in on and off trade in multiple markets. We are also excited about the non-mixer opportunity. I mean, we flagged the fact that we have launched these products to tackle that sophisticated soft drink category. Our ginger beer is doing fantastically well across Europe, leading that charge. We see growing opportunity there. Please do not misunderstand. We are doing a fantastic job in Europe.
We've got a fantastic market position. We see real opportunity ahead, both in mixing and in other categories. You had a question on non-alc. It is, of course, something that we are thinking very hard about. As I referred to in my answer to Ed's question earlier about innovation, it's something that is being looked hard at in the innovation team because there's no question that that is becoming ever more interesting as a category. There's great desire from retailers to improve their offering. They're very conscious that they've got a growing portfolio of non-alcoholic beer, but relatively little else. It is very apparent to us that this is a real opportunity for the Fever-Tree brand. I'm sure we'll be talking more about that in the months to come.
Perfect. Thank you so much.
As a reminder to ask a question, please press star followed by one on your telephone keypad. We now have a question from Rashad Kawan from Morgan Stanley. Please go ahead.
Hey, good morning. Morning, Tim, and morning, Andy. Thanks for taking my questions. A couple for me, please. First, I mean, I appreciate the strength of the brand across markets, which continues to be impressive. Since the update in January, sentiment across consumers in Europe and the U.S. seems to have gotten weaker overall. Have you seen a change in consumption patterns or anything on the ground since your last update that surprised you? Second question, obviously, your cash position improved quite substantially. Outside of the benefits, obviously, to come from the Molson partnership, I mean, what have you done differently last year around inventories and working capital to enable that improvement that you were not necessarily doing maybe as efficiently before? Thank you.
Yeah. No, look, it's sort of a very short answer to your first question. We haven't seen any change. I mean, looking at our U.S. business that continues to grow very positively, the momentum that we have built in that business, we are seeing, certainly, in the first few months of trading. I know there's been talk about U.S. consumer sentiment changing, but that's not something we've seen reflected in our business to date.
Yeah. On the working capital, we've spoken over the last couple of years about the investments we've made in our systems, our processes. Really, the working capital improvement was driven by an inventory optimization, which was driving the benefit of that platform, the ability to real-time forecasting, production scheduling, and then really being able to optimize the inventory we're holding in various places around the world. That was a big program we were really prioritizing delivering over the course of last year. You see the benefit it drove in working capital.
Thank you very much. We now have a question from Philip Spain from JPMorgan. Your line is open. Please go ahead.
Hi. Good morning. Thanks very much for taking my questions. My first one is on the U.S. I appreciate the great work you've done the last few years to improve the non-tonic part of your portfolio. Is there something more you could do to accelerate that part of the portfolio? Particularly thinking, is there any cocktail trends that you think would lean into some of those products in the non-tonic area? My second question is just on whether, given the partnership with Molson Coors in the U.S, is there a similar partnership you would consider within continental Europe that could provide similar benefits in terms of larger distribution and kind of accelerate that growth opportunity? Thank you.
Yeah. I mean, answer to your first question is that, as I think you'll know, is that we are adding new drinks targeted at new cocktails on quite a frequent basis. We have got a wide variety covering a wide variety of these cocktail occasions. We are well covered. Clearly, in lots of these, we are quite early on in that distribution journey. We see lots of opportunity to increase our footprint with lots of this new innovation. We think that is only going to continue to fuel and drive our non-tonic business, which we are very optimistic about. In answer to your question on the other partnership opportunities, look, I think it is fair to say that the deal we have struck with Molson Coors has not been lost on the rest of the trade. I know it has been received with great interest.
That is reflected in some of the incoming that we've had. This is part of the way we always look at our business, to make sure that we've got the right partner for the right age and the right stage of development in our market. This is something that we will continue to review. As I say, it certainly provokes some interesting conversations already.
Great. Thanks very much.
Thank you.
We currently have no further questions. This concludes today's call. Thank you very much for joining. You may now disconnect your lines.