The maker of Irn Bru is going to put less sugar in its drinks

AG Barr, the maker of Irn Bru, said it would reduce the sugar content of its drinks in the wake of the UK government’s tax on sweet soft drinks.

The company saw revenue fall £2.3 million ($3 million) in 2015 to £258 million, while profits increased 7% to £41 million due to cost-cutting measures.

UK Chancellor George Osborne announced a surprise tax on sugary drinks in his budget this month.

The levy will add 24p to every litre of the highest sugar drink sold and Osborne is hoping the new tax will raise £520 million in its first year.

But drinks companies are upset with the surprise new tax, which they fear will hit sales. As a result, many are considering a legal challenge, likely in Europe, to block the tax.

AG Barr, which also produces Snapple, said:

The development of our existing soft drinks portfolio will continue to be a key area of our strategic focus.

To ensure success in the UK market we are focusing our marketing efforts on our “lower” and “no” sugar products and are substantially reducing the sugar content of our portfolio to reflect consumers’ changing preferences.

We have already made significant progress in this area, reducing the average calorific content of our company owned portfolio by 8.8% in 4 years.

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