Ditell Revenue Growth

Distell Sees 15% Revenue Growth

Distell Bottling

Distell has posted an impressive 15% growth in revenue for the year to June 2012, despite subdued consumer spending in many of the markets where it trades.

This growth has been bolstered by a 9.9% increase in sales volumes across its portfolio of wines, spirits and ready-to-drink (RTD) brands in both domestic and international markets and favourable exchange rate revenue rose to R14.2 billion.

Earnings were impacted, however, by a once-off extraordinary excise duty provision amounting to R297.8 million as a result of a reclassification of wine aperitifs by the South African Revenue Service.

Distell has posted an impressive 15% growth in revenue for the year to June 2012, despite subdued consumer spending in many of the markets where it trades.

Referring to the increased sales volumes in all product categories, Distell Group Managing Director, Jan Scannell, says RTD brands and ciders have performed exceptionally well.

“A suite of strong brands across the portfolio also meant revenue growth could be achieved without sacrificing margins. Gross margin improved to 34.7% from 32.7% a year ago.”

He said the company was on track with its goal to increase the year-on-year contribution of export sales to revenue. The revenue derived outside South Africa, on a non-duty paid basis, comprised 27.5% of the total, up from last year’s 26.4%.

In the domestic market, Distell had outpaced the rate of growth achieved in the national retail alcoholic beverage sector for the reporting period, Scannell said. The company had grown local sales volumes by 9.6%, while revenue had risen by 13.8% to R10.6 billion. 

Strong growth within the company’s spirits division came from brand leader Amarula, cognac brand Bisquit and the Three Ships whisky range. All three brands achieved double-digit growth.

Nederburg had performed extremely well in the premium sector.  Paarl Perlé and Autumn Harvest Crackling had also delivered excellent results in the popularly priced category.

The company’s sparkling wines had marginally outperformed the industry average, while fortified wines had shown an exceptional growth in volume and value, led by Sedgwick’s Old Brown.

Wine sales growth had been slightly below the national average of 4.3% but Scannell said that there had been some significant highlights