Lucas Bols revenue falls 2% in H1

Dutch spirits group Lucas Bols has reported a revenue decline of 2% to €47.8 million (US$54.5m) in the first half of 2018/19, with revenue from the company’s regional brands down by 10.5%.

The Lucas Bols range

In the six-month period from 1 April 2018 to 30 September 2018, the company’s global brands segment – which included Bols Liqueurs, Bols Genever, Bols Vodka, Damrak Gin, Passoã, Galliano and Vaccari Sambuca – reported a revenue increase of 0.7% to €37.6m (US$42.8m). This was mainly attributed to the “good performance” of Passoã. The segment grew 3% organically.

Passoã, which Bols took over in December 2016, grew by mid-single-digits, driven by the UK and the expansion of distribution to 35 US states and “recovery in Puerto Rico”. The brand also showed growth in Asia Pacific.

Revenue of the Bols Liqueurs range witnessed “continued growth” in the US and a “strong performance” in China offset by a decline in Japan.

Revenue of the regional brands – comprising Dutch Genevers, Vieux, Pisang Ambon, Coebergh and continent/country-specific brands such as Regnier Crème de Cassis in Japan – fell to €10.2m (US$11.6m), down from €11.5m (US$13.1m) in the same period last year. The decline was attributed to Western Africa where the company experienced temporary import restrictions for its brands into Togo and Benin.

North America grew by double-digits in revenue due to the “strong performance” in the US.

Asia Pacific witnessed “healthy” revenue growth, attributed to “accelerated growth” in China. Western Europe and emerging markets saw revenue decline due to the performance of the regional brands.

In the third quarter, Lucas Bols signed a new five-year €130m (US$148.4m) syndicated credit facility agreement, replacing the existing agreement.

Huub van Doorne, CEO of Lucas Bols, said: “In the first half of 2018/19 we were pleased to see the healthy revenue growth of our global brands continue as a result of the good performance of Passoã, double-digit revenue growth in the US and accelerated growth in China.

“We managed to stabilise our EBIT despite more difficult trading conditions in emerging markets. Furthermore, we are pleased with our new credit facility that further enhances our flexibility and will reduce our annual financing costs. We are pleased to offer an interim dividend of €0.35 per share.”

Looking ahead, the company said in a statement: “The underlying dynamics in the global cocktail markets remain healthy.

“We expect revenue growth from the global brands to further increase in the second half of the 2018/19 financial year, mainly driven by the strong growth in the US market.

“The performance of the regional brands will remain under pressure in the second half of the year.”

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Author: Nicola Carruthers {authorlink}