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Stock Spirits reports 3.3% sales drop
Prestige vodka owner Stock Spirits saw revenue decline 3.3% in the six months ending 31 March 2021 due to the closure of the on-trade in the Czech Republic.
For the six-month period, the company’s sales reached €183.4 million (US$222.3m), however profit for the period climbed 91.6% to €28.1m (US$34m).
In the Czech Republic, the company’s sales declined by 16.6% to €45.2m (US$54.8m). The decline was due to the closure of the ‘sizeable’ on-trade channel and price discounting from competitors in the imported rum category, Stock Spirits said.
Sales in Italy rose 26.3% to €18.6m (US$22.5m), boosted by the Distillerie Franciacorta business, which Stock Spirits acquired in 2019.
The company witnessed ‘continuing positive momentum’ in Poland, the group’s largest market. Revenue dropped by 0.5% to €104.3m (US$124.4m).
Stock Spirits said it had ‘outperformed’ the total vodka category in Poland, growing value by 10.6% and increasing its value share from 29.7% to 30.7% on a moving annual total (MAT) basis.
Stock Spirits is also working on a new distillery at its Lublin facility in Poland.
Mirek Stachowicz, chief executive officer, 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.”
Stock Spirits said the negative impact of Covid-19 on the firm’s on-trade business will continue until the pandemic is brought under control.
The company said mergers and acquisitions remain a ‘strategic focus’, despite activity being curtailed by the pandemic over the last 12 months.
The firm said it will ‘seek out larger, more strategic opportunities to deliver growth and shareholder value for the future’.
Stachowicz added: “We are broadly on track with our 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.”