Stock Spirits Takes Hit From On-Trade Closures
Spirits maker Stock Spirits Group has said that restrictions in the on-trade channel impacted its performance in its most recent trading period.
The group issued a trading update for the period from 1 October to 4 February (which includes its first quarter as well as the period leading up to its AGM), which indicated that while its performance in the on-trade has been lower than predicted due to the restrictions, it has managed a steady performance in the off-trade to keep up with overall expectations for full-year 2021.
The group is hopeful that the introduction of a vaccination against COVID-19 will allow for the lifting of restrictions across the market, thereby boosting the group's performance.
In Poland, the total vodka market recorded an increase in value of 4.3%, while volume decreased by 3.3% compared to the first quarter of last year, as the market continues to experience premiumisation.
The Polish government passed legislation to implement additional taxes on small format bottle sizes (300ml or smaller) of alcoholic drinks, which came into effect from 1 January 2021. This means that a 100ml bottle of 40% ABV vodka will carry an additional PLN 1 tax.
However, Stock Spirits does not believe the tax will make a substantial difference to their results.
In the Czech Republic, a similar trend towards premiumisation was seen in the spirits market, as business grew in value by 11.9% and volume by 4.8% during the period.
The upcoming year is set to be a productive one for the group, as Diageo has decided to consolidate its distribution structure in the Czech Republic, with Stock Spirits distributing the drinks giant's full portfolio of premium and 'Reserve' brands from March 2021.
This portfolio includes brands such as Zacapa Rum, Tanqueray Gin, and Bulleit Bourbon, and continues the partnership with Diageo in this market since 2014, for its core brands of Captain Morgan, Johnnie Walker, and Baileys.
Finally, in Italy, the group grew its market share, and added the Beam Suntory distribution brands, which led to growth in its value share during the year.
Commenting on its performance, Mirek Stachowicz, chief executive at Stock Spirits, said the group is pleased with its performance, as it benefited from a “longstanding off-trade focus", as well as a"local sourcing and manufacturing strategy", which meant the group didn't face distributions to its operations during the pandemic.
Stock Spirits also announced that there have been no developments regarding its Polish subsidiary’s appeal to the Supreme Administrative Court against the assessment in respect of its 2013 corporate income tax return. The group does not expect the case to be heard in the 2021 financial year.
© 2021 European Supermarket Magazine – your source for the latest retail news. Article by Conor Farrelly. Click subscribe to sign up to ESM: The European Supermarket Magazine.