TIDMDIS
RNS Number : 7899D
Distil PLC
29 October 2015
Distil plc
("Distil" or the "Group")
Interim Results for the six months ended 30(th) September
2015
Distil (AIM: DIS), owner of premium drinks brands; RedLeg spiced
rum, Blackwoods gin and vodka, Blavod black vodka, Jago's cream
liqueur and Diva vodka, today announces its unaudited interim
results for the six months ended 30th September 2015.
Operational review:
-- Consumer awareness, trial and repeat purchases of RedLeg
spiced rum continue to grow as we build UK On Trade
distribution.
-- New listings of RedLeg in 400 UK supermarkets supported with promotion in store.
-- First shipments of Blackwoods Small Batch gin to USA.
-- Reopening of US market for Blavod black vodka with initial shipments now in market.
-- Decline in volume of Blavod black vodka through Eastern
Europe due to the impact of adverse currency rates on Duty Free
sales.
-- Increased investment in marketing and promotion of our brands
in key outlets is driving rate of sale.
-- Blackwoods Limited Edition (60% ABV) approved by TTB for the US.
Financial Review - versus same period last year:
-- Revenue increased by 89%
-- Gross profit increased by 95%
-- Volume (litres) increased by 23%
-- Administration costs reduced by 16%
-- Investment in brand marketing and promotion increased by 100%
-- Reduction in adjusted operating loss of 69%
Don Goulding, Executive Chairman of Distil, said:
"The continued progress in developing our brands in key markets
is reflected in a pleasing set of first half results. Revenue
growth is being supported by increased investment in brand
marketing and we are seeing this come through to the bottom line as
we tightly manage our costs and deliver procurement
efficiencies."
Executive Chairman's statement
Results
Overall sales volumes and revenues for the period are
significantly ahead of last year. This is mainly due to the strong
growth of RedLeg spiced rum and continued progress of the
Blackwoods brand on the back of increased marketing support and
distribution gains. Duty Free sales of Blavod black vodka in
Eastern Europe continue to decline due to adverse currency exchange
rates.
Gross profits and margins also rose during the period,
benefitting from the growth in sales revenue and reduced production
costs on a per case basis through procurement savings as a result
of improved forecasting and quantity efficiencies. Product quality
has been maintained and improved throughout this process.
On the cost side; we reduced administrative costs by 16% as we
secured the last of those benefits coming through from our
reorganisation last year.
The savings in production and overheads costs achieved during
the period were invested in brand marketing.
Operations
Our efforts remain focused on the development of our key brands
in key markets. This is reflected in the growing number of
stockists both in bars and retail stores secured by our
distributors and ourselves. Where possible we have supported our
products at the point of purchase with promotional activity to
encourage consumer awareness and trial.
We announced today that a leading supermarket group has listed
RedLeg for 700 of its largest stores throughout the UK. This
follows the successful listing of RedLeg in April 2015 by a major
UK grocery chain and significantly increases the brands presence
and availability in the UK.
Investment was maintained at music and food festivals throughout
the summer with excellent results for both RedLeg and Blackwoods
gin. The RedLeg rum shack popped-up in some unusual places
including the Henley Regatta.
In the USA we will focus on building Blackwoods Small Batch
brand before introducing our Limited Edition. We still await TTB
approval for RedLeg spiced rum. The delay was caused by a query
relating to a technical description of one of the ingredients,
which is in the process of being resolved. We understand this
should not affect the brand's availability for launch next year as
planned.
As reported earlier Jago's vanilla vodka cream liqueur has been
redesigned and reformulated ready for launch; however, we have held
back from major investment in production and marketing until a
listing with a major retailer is secured. The cost of market entry
is high in the cream liqueur category and therefore we would need
to be confident that the launch would not risk eroding shareholder
value. Efforts to secure major listings have been made throughout
this year and will continue.
Shipments of the newly redesigned and repackaged Diva vodka have
begun in the UK and Europe. Diva is a super premium offering and
the initial consumer response has been positive.
Outlook
The market remains highly competitive as the consumer is faced
with a growing number of choices and offers. Therefore marketing
and promotional investment will be maintained on our brands.
We remain confident that our strategy of developing and
supporting our brands in key markets will enable us to continue to
grow revenues across the portfolio. Accordingly, we expect our
encouraging 1(st) half performance to continue and are confident
for the full year, which we expect will be in line with market
expectations.
Distil plc - Half Year Results
Consolidated comprehensive interim
income statement
-------------- -------------- ----------
Six months Six months Year
ended ended ended
30 September 30 September 31 March
2015 2014 2015
Un-audited Un-audited Audited
GBP,000 GBP,000 GBP,000
Profit & Loss
Revenue 530 280 666
Cost of sales (223) (123) (260)
-------------- -------------- ----------
Gross Profit 307 157 406
Administrative expenses:
Advertising and promotional costs (133) (66) (148)
Other administrative expenses (237) (284) (563)
Share based payment expense (29) - -
Depreciation & amortization (2) (2) (4)
Other Operating Income 5 - 23
-------------- -------------- ----------
Total administrative expenses (396) (352) (692)
-------------- -------------- ----------
Operating loss (89) (195) (286)
Finance expense (1) (3) (3)
-------------- -------------- ----------
(Loss)before tax from continuing
operations (90) (198) (289)
Income tax - - -
-------------- -------------- ----------
(Loss) for the period (90) (198) (289)
-------------- -------------- ----------
Earnings per share:
From continuing operations
Basic (pence per share) (0.02) (0.05) (0.08)
Diluted (pence per share) (0.02) (0.05) (0.08)
Consolidated interim balance sheet As at As at As at
30 September 30 September 31 March
2015 2014 2015
Un-audited Un-audited Audited
GBP,000 GBP,000 GBP,000
ASSETS
Non current assets
Property, plant and equipment 4 8 6
Intangible fixed assets 1,516 1,497 1,510
-------------- -------------- ----------
Total non current assets 1,520 1,505 1,516
Current assets
Inventories 239 115 230
Trade and other receivables 205 221 211
Cash and cash equivalents 355 189 511
-------------- -------------- ----------
Total current assets 799 525 952
-------------- -------------- ----------
Total assets 2,319 2,030 2,468
-------------- -------------- ----------
LIABILITIES
Current liabilities
Trade and other payables (150) (271) (238)
-------------- -------------- ----------
Total current liabilities (150) (271) (238)
-------------- -------------- ----------
Total liabilities (150) (271) (238)
-------------- -------------- ----------
Net Assets 2,169 1,759 2,230
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