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Distil swings to loss after UK gin market softens
24th Oct 2019 11:13
(Sharecast News) - Shares in Distil slumped on Thursday after it swung to an interim loss as a slowdown in the UK gin market hampered revenue growth.
The alcoholic beverage company reported a loss before tax of £1,000 for the six months ended 30 September, compared with a profit of £101,000 in the same period last year, as revenue fell by 29% to £824,000.
The AIM traded company, which owns premium drinks brands RedLeg Spiced Rum, Blackwoods Gin and Vodka, Blavod Black Vodka, Jago's Cream Liqueur and Diva Vodka, attributed the fall in revenue to strong comparatives and a summer slow-down in the UK unflavoured gin market.
Consequently, the company increased promotional brand support for the second half of the year, with the aim of growing volumes ahead of the market in the traditionally strong festive period.
Even so, Distil said it expected revenue to miss market forecasts, though operating profit is still anticipated to be in line due to cost control measures.
Executive chairman Don Goulding said: "Whilst we expect further growth in the spiced rum market we anticipate further softening of the unflavoured gin category into the foreseeable future. Despite these headwinds we remain confident in our strategy of investment in marketing support to our brands, coupled with new product innovation, to deliver growth over the medium term."
Distil shares were down 14.71% at 0.72p at 1234 BST.
The alcoholic beverage company reported a loss before tax of £1,000 for the six months ended 30 September, compared with a profit of £101,000 in the same period last year, as revenue fell by 29% to £824,000.
The AIM traded company, which owns premium drinks brands RedLeg Spiced Rum, Blackwoods Gin and Vodka, Blavod Black Vodka, Jago's Cream Liqueur and Diva Vodka, attributed the fall in revenue to strong comparatives and a summer slow-down in the UK unflavoured gin market.
Consequently, the company increased promotional brand support for the second half of the year, with the aim of growing volumes ahead of the market in the traditionally strong festive period.
Even so, Distil said it expected revenue to miss market forecasts, though operating profit is still anticipated to be in line due to cost control measures.
Executive chairman Don Goulding said: "Whilst we expect further growth in the spiced rum market we anticipate further softening of the unflavoured gin category into the foreseeable future. Despite these headwinds we remain confident in our strategy of investment in marketing support to our brands, coupled with new product innovation, to deliver growth over the medium term."
Distil shares were down 14.71% at 0.72p at 1234 BST.