Distell volumes fall by about a quarter
The liquor group expects a sharp drop in its profits in its year to end-June
Distell, the maker of the Savanna, Hunter’s Dry and Nederburg brands, says it has seen a spike in demand in SA as restrictions on selling of alcohol have eased, but volumes remain down about a quarter year on year.
From July 1 2019 to the end of June 2020, its SA revenue was down by 18.3% and volumes by 25.6%, the liquor group said in a trading statement.
The easing of export regulations related to agricultural products during level 4 of the lockdown meant that open orders to the value of about R440m could be processed.
However, the group has only managed to fulfil 54% of the value of these orders because local ports were operating at a reduced capacity, and due to customer cancellations.
Distell said it is facing continued uncertainty regarding writing down the value of its stock, as well as potential losses related to money it is owed. Overall, group revenues to June 19 have contracted 15.4%, while volumes have fallen 23.3%.
The group expects headline earnings per share (HEPS) to fall by 60%-80% in its year to end-June, unchanged from a trading statement issued in May.
In morning trade on Tuesday, the group’s share had risen 0.4% to R76.07, having lost about 42% so far in 2020.
Correction: June 30 2020
An earlier version of this article stated Distell's numbers were performance figures to the end of June, when they are, in fact, until the end of June 19 2020.