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Distell H1 sales boosted by spirits

South African drinks group Distell saw its group revenue rise by 9.3% to R13.4 billion (US$1.1bn) in the second half of 2017, bolstered by “strong” volume growth from its spirits and ready-to-drink (RTD) range.

Amarula maker Distell saw its H1 2017 sales rise by 9.3%

In the six months to 31 December 2017, the group – which owns Amarula cream liqueur, Bunnahabhain single malt Scotch whisky, and Richelieu brandy – saw operating profit increase by 6.5% year-on-year.

The group’s spirits and RTD portfolio delivered “strong” revenue and volume growth. Brandy experienced “exceptional” volume gains of +14%, and gin grew by 21%.

In Africa, revenue growth was up by 18.5%, with sales volumes up by 6.6%. In travel retail, sales grew by 43%.

International revenue increased 7.7% due to “increased” local investment in the UK market and a “positive” foreign exchange effect.

Distell’s whisky market share in Taiwan increased by 0.5% against an overall volume decline in the market.

The group said that the restructuring of its shareholder programme is expected to be finalised in April 2018, subject to regulatory approvals, which will result in the re-listing of its shares and an increase in free-float.

Distell’s Group managing director, Richard Ruston, said: “Distell has delivered commendable top-line revenue growth in the face of increased competitor activity across all our reporting geographies leading to revenue growth in 12 of our top 15 largest brands. We defended and grew our competitive position in all three categories in the domestic market.”

The disposal of Bisquit Cognac – which it sold to Campari for €52.5 million in December last year – and Lusan Wine farms also allowed the group to focus on its core portfolio and contributed to an “improved return on invested capital”.

“Looking ahead, we will defend and grow our market share through an optimised brand portfolio and innovation whilst we continue to build our pan-African platform,” added Rushton.

“The process of creating a more agile and efficient business is bearing fruit which and this will be accelerated. Our portfolio of strong, diverse and appealing brands and the capacity to trade across a spectrum of markets gives us a competitive advantage, positioning us for long term growth.”

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