Stock Spirits: Covid impact ‘less than anticipated’
Prestige vodka owner Stock Spirits said the impact of Covid-19 on the second half of its financial year was “less than initially anticipated” due to a strong off-trade performance.
The Central and Eastern European drinks group provided a trading update for its year ending 30 September 2020 and reported that cash flow from operations for the year was “strong” and resulted in net debt of €23 million (US$27m), down from €55m (US$65m) last year.
The group’s performance was benefited by increasing off-trade sales due to on-trade restrictions and consumer “staycations”.
The Polish and Czech spirits markets, which account for three quarters of Stock Spirits’ revenue, continued to show growth in both volume and value terms during the year. This was despite excise increases during the period and the impact of coronavirus on spirit sales.
The company said its Polish business outperformed the total vodka market, boosted by innovation in the flavoured category. Meanwhile, Stock Spirits’ herbal bitters range was also aided by premiumisation and new product development.
On-trade business Bartida, which Stock Spirits acquired in 2019, “exceeded expectations” during the year. The company said grappa producer Distillerie Franciacorta, which also joined Stock Spirits’ portfolio last year, is performing in line with expectations despite a “challenging” Italian environment.
Stock Spirits will announce its full results for the year ended 30 September 2020 on 2 December.
As well as offering a trading update, Stock Spirits said its Polish subsidiary has been issued with an assessment by the Polish tax authorities in respect of its 2013 Corporate Income Tax Return.
Stock Polska has lodged an appeal against the ruling with the Supreme Administrative Court, which the firm believes is likely to be successful. However, the group said the hearing is not expected for a number of years.