Stock Spirits has staved off difficulties in Poland, which it said ‘remains a challenging and highly competitive market’, to record group-wide revenue of €261 million in 2016 and growth in net profit of 46.4%.
The alcohol company implemented changes across a number of core brands in Poland, which accounted for more than 52% of its revenue last year, to bring pricing closer to that of its competitors. New product activity was slowed during the year with a focus on existing core brands to help offset the negative impact of the new prices.
Poland’s economy grew at its slowest rate since 2013 last year, impacted by reduced EU development funds and domestic politics discouraging investors. But GDP grew by 2.7% in the final quarter of the year, and the country’s government expects a return to strong growth in 2017.
In the last 12 months, Stock Spirits signed an agreement with Synergy Group to distribute the super-premium Beluga vodka brand portfolio in Poland, and its Beam contract in the country was renewed.
It also acquired three alcohol brands in the Czech Republic – its second largest market, contributing almost a quarter of group revenue – for a combined total of €5 million.
Stock Spirits CEO Mirek Stachowicz said: “2016 has been a year of significant change for Stock Spirits, and we have emerged from it in a much stronger position than we were in this time last year. Trading has remained challenging in our core Polish market, where there have been several significant changes in the competitive landscape. Against that backdrop, we are pleased to have made tangible progress across a range of strategic initiatives that are aimed at improving the long-term performance of the group.
“Furthermore, we are now starting to see signs of stabilisation in our Polish business, as reflected by the market share gains that we achieved in both value and volume terms during the second half of 2016 versus the first half.
“We have a strong portfolio of award-winning brands, an exceptional distribution network, well-invested production facilities, and an outstanding and committed team at all levels of the organisation. These factors, as well as our ongoing restructuring activities and cost control measures, leave us well positioned to achieve sustainable long-term growth and as a result we look to the future with confidence.”
In all, the group’s net sales revenue was down a nominal 0.6% to €261 million. Its profit after tax was 46.4% higher at €28.4 million. Its total sales volume saw a 4.2% increase, reaching 12.3 million 9-litre cases compared to 11.8 million in 2015.
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