Stock Spirits Posts Profit Of €28.1m In First Half
Stock Spirits Group PLC, the owner and producer of branded spirits and liqueurs sold in Central and Eastern Europe and Italy, has posted a 91.6% year-on-year increase in profit to €28.1 million the six months ended 31 March 2021.
In Poland and the Czech Republic, the core markets of Stock Spirits, the group grew its market share in the off-trade channel, with COVID-19 lockdowns heavily restricting the on-trade channel for most of the period.
The on-trade channel accounted for only 6% of the group's first-half revenue compared to a normal level of 15%.
Stock Spirits continued its positive momentum in Poland, its largest market – accounting for 57% of revenue – achieving a five-year-high value market share of 30.7% as of March 2021 in the vodka category. Revenue in the division rose by 4.3% in this period, while EBITDA was up 6.8% on a constant currency basis.
The lockdown restrictions impacted several markets, as did an increase in local competition, the company noted. In the Czech Republic, revenue decline by 13.6% and EBITDA by 21.2% on a constant currency basis.
This was slightly offset by the business growing value market share in the country to 33.5% as of March 2021 (on a MAT basis), from 33.3% in March 2020.
Stock Spirits' activities in Italy benefitted from increased scale and a strong contribution from the recently acquired Distillerie Franciacorta, with value market share up in all categories.
'Resilient Financial And Operational Performance'
Mirek Stachowicz, CEO of Stock Spirits, said "This has been another resilient financial and operational performance against a hugely challenging backdrop. We managed to largely counterbalance the widespread closure of the on-trade in all of our markets by growing our strong brands in the off-trade. This was driven both by successful product innovations and by the trend for consumers to turn to familiar and trusted brands during times of uncertainty."
Looking forward, Stachowicz added that the group is "broadly on track" with its plans for the year, "notwithstanding the continuing disruption from the pandemic and the impact from the Polish small format tax."
"Whilst there remains some uncertainty in the short-term outlook, we remain confident in the future prospects for Stock Spirits, as illustrated both by the investments that we are making in our brands and infrastructure, and by the continuation of our progressive dividend policy,” he added.
Stock Spirits posted an interim dividend of 2.98 € cents per share, an increase of +7.6% from 2.77 € cents per share last year.
The group’s €200 million financing facilities have been renewed and now run to May 2024, with the possibility to extend up to 2026, the company added.