Marie Brizard reports Q1 sales increase of 0.2%

Marie Brizard Wine & Spirits (MBWS) has reported a slight increase in organic net sales for the first quarter of 2019.

Net sales for the first quarter reached €81.6 million (US$91.4m) – an increase of 0.2%. The company’s ‘branded business’ grew net sales by 12.8% to €41.2m (US$46.1m). This growth was partially offset by net sales in ‘other businesses’, which fell by 10% to €40.4m due to “lower sales” of Sobieski trade and the Private Label business.

Andrew Highcock, CEO of MBWS, said: “The momentum in MBWS’ results was further confirmed by Q1 2019 net sales, with the branded business growing double-digits. While 2019 remains a year of transition, I am confident that we are on the path to re-establishing profitable businesses across our clusters in the medium term, and setting the bases for future growth.”

Following the “suspension of promotional activity”, net sales in France fell by 5.5% to €20.4m (US$22.8m).

In central and Eastern Europe, sales grew by 48% to €12.5m (US$14m) due mostly to “ongoing momentum driven by expanding distribution in Poland”.

Elsewhere in the region, sales grew by 22.5% to €6.8m (US$7.6m), due to “strong sales in Lithuania in advance of an excise duty increase that went into effect in early March”. Bulgaria also performed well during the quarter.

Sales in the Americas region grew 53.6% to €4.1m (US$4.6m).

The Lancut distillery in Poland began operations in February 2019 and is “now in the ramp-up phase”. The new distillery is expected to produce distillate for use in the firm’s vodka production, particularly the Krupnik and Sobieski brands.

MBWS has also appointed Robert Cooper as the new general manager of its Polish subsidiary, MBWS-Polska, following the recent departure of Ania Jakubowski.

The French firm has “continued discussions” with its banking partners and aims to reach an agreement regarding the group’s refinancing.

The company’s largest shareholder – French holding company La Compagnie Financière Européenne de Prises de Participation (COFEPP) – has proposed a new financing agreement, via a shareholder current account to be disbursed in several allotments.

The deal proposes that any amount of this financing should be reduced in relation to the level of the funds generated via the subscription to short-term and long-term stock warrants that have been or will be received by the company on and after 23rd April 2019 (at present, this totals around €5m).

Highcock added: “We are working full-speed ahead to execute the 2019-2022 Strategic Plan, and remain focused on implementing the measures to address the challenges facing each one of our markets, as well as identifying top-line and cost synergies to be generated through our close collaboration with COFEPP.

“The activities that will be implemented through this strategic relationship are key to improving profitability at MBWS in the years ahead.

“MBWS shareholders collectively subscribed 15.4% of the issued warrants, yielding MBWS €20.1m in new funds which will be used to execute the strategic plan.”

In a statement, the company said: “MBWS reiterates the objective provided in its 2019-2022 strategic plan, which is to gradually return to profitability, and to set the conditions for future growth with the objective of generating EBITDA in a range of €13m to €19m in the year 2022.”

For the year ended 31 December 2018, MBWS saw its organic sales drop 6.2% to €389 million (US$440m).


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Author: Nicola Carruthers {authorlink}