Chapel Down has hailed positive Christmas trading for helping it offset woes in the first half of the year.
The English sparkling winemaker said full-year sales net of duty and retrospective discount support (NSR) in the year to 31 December were expected to decline by 5% to £16.3m – in line with its previous, downgraded guidance.
Excluding its now mothballed spirits business, NSR fell by 3%, Chapel Down said.
Chapel Down had shown “good sales momentum” in the second half of 2024, growing NSR by 1%, the Kent-based winemaker said. The festive trading period was “particularly strong” it noted, with NSR in Q4 climbing by 7% (or 10% excluding spirits).
Growth in e-commerce (22%) and the on-trade (16%) were offset by challenges in the off-trade, which saw NSR slide by 19% to £6.8m. The full-year decline is an improvement in the 36% fall in the off-trade reported by Chapel Down in the first six months of the year.
Supermarket sales growth
Chapel Down, which blamed its first half showing on “one-off reductions in stock held by retailers” said supermarket sales “continued to show growth throughout the year”.
Citing NIQ data, the supplier said sales to consumers grew by 2% in the full-year period, and were up by 25% in the 12 weeks to 28 December.
Average selling prices for Chapel Down’s sparkling wines (accounting for 70% of all sales) grew by 5%. This reflected “continued brand strength and consumer demand”, Chapel Down said. Still wines saw a 9% reduction in average selling price after planned reductions in rrp, it added.
Net debt, meanwhile, climbed from £1.2m to £9.2m after Chapel Down planted 118 acres of new vines, as well as increasing stock levels following an exceptional harvest in 2023.
The two decisions would underpin “future growth” Chapel Down said, adding it retained “significant headroom” on a £20m revolving credit facility.
‘Operational progress’
It had been a year of “continued strong consumer demand” and “significant strategic and operational progress” for Chapel Down, said CEO Andrew Carter.
“Chapel Down enjoyed strong growth in its direct-to-consumer channels, maintained its market leadership in the critical off-trade, with strong sales momentum across our channels in H2, accelerating in the all-important final quarter,” Carter said.
Carter, who is preparing to leave Chapel Down to become CEO at brewer Timothy Taylor’s, added: “As I reflect on my time at Chapel Down, our fantastic team can take great pride in what we have achieved.
“Chapel Down has a renewed focus on our market leadership of the growing English wine region. We have invested to grow our vineyards to over 1,000 acres, circa 10% of the UK’s total, we have developed our premium sparkling wine brand, grown the broadest and deepest distribution base and created a single business platform to support future growth.”
James Pennefather, previously CEO at The Lakes Distillery Company, is to take over the reins at Chapel Down from 1 Feburary, the AIM-listed winemaker announced last month.
Chapel Down shares climbed 2% in early morning trading.
No comments yet