2009 Full Year Results - A Record Year
A record year: continued double digit earnings growth.
Stock Spirits Group (‘SSG’ or ‘the Group’), Central Europe’s leading producer of branded spirits, is pleased to announce its full year results for the year ended 31 December 2009.
Financial highlights 2009:
- Revenue up 17% to €262.0m (2008: €224.0m)*
- EBITDA up 46% to €62.9m (2008: €43.2m)*
- EBITDA margin improved from 19.3% to 24%*
- Invested over €40m in brands and production facilities
- Cash flow remained strong
* At constant 2009 exchange rates
Operational highlights 2009:
- Polish vodka Czysta de Luxe sold 5.4m 9 litre cases to become the fastest growing vodka brand in the world in 2009**
- SSG now has a Number 1 position in three of its core markets
- Poland: now the clear market leader in vodka with over 30% market share
- Czech Republic: maintained position as market leader with 36% of spirits market
- Slovakia: market leading importer of spirits
- Owned sales & distribution operations were established in Bosnia & Herzegovina and Croatia
- International division fully established with core brands now distributed in over 40 markets worldwide
- Many new products successfully launched in 2009 to drive future growth
** Source: Drinks International 2009 market data
Post period end:
- New Group CFO appointed
- Stock XO Brandy and Stock Prestige vodka launched in international markets
- Overall company and brand growth continues in line with management expectations
Regional performance overview:
Strong performances in Poland and the Czech Republic were the major contributors to Stock Spirits Group growth in 2009.
In Poland, Czysta de Luxe, launched by SSG in November 2007, sold 5.4m cases in 2009 (2.1m cases in 2008) – making it the No.1 clear vodka*** and the fastest growing vodka brand in the world in 2009. The Group also owns the No.1 flavoured vodka in Poland with its flagship brand, Wódka Żołądkowa Gorzka (WZG).
To complement the existing strong vodka portfolio, Stock Polska also successfully launched Stock Prestige in the premium clear vodka segment towards the end of 2009. This brand is currently performing extremely well and is significantly outselling the initial sales forecasts.
To cope with the rapid growth of the Polish vodka portfolio, Stock Spirits Group has invested significant capital in the Group’s production facilities in Lublin in the last two years and the Lublin factory is now the biggest bottling site in Europe with a capacity of 480m bottles per year. Overall production volumes doubled in 2009 to 97m litres.
In the Czech Republic, Stock Plzeň-Božkov maintained its leading market position with a 36%**** share of the spirits market, selling a record 28m litres of spirits in 2009 following a record year of 27m litres in 2008. This was partially helped by strong trade purchases ahead of 2010 duty increases. Key brands include the leading Fernet brands, Fernet Stock and Fernet Stock Citrus, as well as the Božkov range of products.
Stock Italy successfully re-launched Limoncè, the Limoncello market leader, and Keglevich vodka consolidated its No.1 position in the growing flavoured vodka category.
The International division continued to establish a strong base for future growth, whilst Stock USA further developed its relationship with its appointed distributor, Gemini Spirits & Wine Company, a wholly owned subsidiary of the Sazerac Company.
*** Source: Nielsen market share data
****Source: Nielsen Retail and Dataservis On-trade data
Chris Heath, CEO of Stock Spirits Group, commented:
“We are delighted to have achieved a record year of profit growth, especially against the challenging global economic backdrop. This clearly reflects our strength as one of Central Europe’s most successful producers and marketers of branded spirits.
In 2009 we attained market leadership position in vodka in our key market of Poland, building from successful brand launches in 2007 and 2008. We are particularly pleased with creating in Czysta de Luxe the fastest growing vodka brand in the world in 2009**.
As we pursue our goal to consolidate our position as Central Europe’s leading producer of branded spirits, we will continue to invest in existing brands, people and production assets and we will continue to seek opportunities to expand into new markets across the region where we believe there are significant growth opportunities.
We would like to thank Oaktree Capital Management for being a supportive shareholder. With their help, we have been able to invest over €75m in our brands and production facilities in the last two years and as result have established what we believe to be a very strong platform for future growth.
In 2010 we continue to perform in line with management expectations and I am confident that prospects for the full year will build upon the strong growth achieved in the last two years.”
** Source: Drinks International 2009 market data