Solid year of recovery Full-year results from Nichols are in line with expectations. Adj PBT was £25m (vs our forecast of £25.2m and FY22 £21.8m) with EPS at 55.4p and a FY dividend of 27.7p (+19.9%). The revenue line was 14.3% ahead, with strong UK (13.7%) and International (16.1%) growth. In the UK, the performance was led by the Out of Home (OOH) market, which was up 42.8% as it recovered from COVID. The UK packaged revenue was up by a more modest 2.9% - behind this there was a good Stills performance, but carbonates was more challenging, with volumes down 16% as the group protected margins. Cost pressure offset Margins were held at 15.1% in the year, which indicated the group has managed the inflationary cost environment. This was assisted by the move to a new packing contract, which helped reduce bottling costs in the year. There was an exceptional charge of £11.1m in the period – this was anticipated (goodwill write-down) and reflects the strategic review of the OOH operations. The actions to improve margins in OOH will be implemented through 2023 (exiting unprofitable contracts, simplifying the business to cut costs) and with the results expected to feed through in FY24. Looking to hold profits FY23. This year the company reports it is trading in line with expectations. It has indicated that it expects to deliver FY23 PBT in line with FY22 (£25m) with consensus at £25.1m. INVE FY23E £24.9m, EPS 51.7p. With the OOH improvement expected in FY24, we expect better progress.