Spirits group Distil saw turnover shrink by 23% last to £1.44 million in the first half of 2021, as business returned to a more even keel following last year’s unprecedented one-surge in sales.
The spirits brand said that despite the challenging comparatives, the picture was positive with turnover up 75 % in the six months to September 2021, compared to the same period in the pre-pandemic first half of 2019 (£824k). Similarly, volumes were down 21% on last year’s figure, but remained up on 2019 by nearly 50%.
Last year the group, which makes RedLeg Spiced Rum and Blackwood’s Vintage Gin and Vodka, reported a surge in profits after concentrating on retail sales with sales up 128% in the six months to September 2020 boosting operating profit by £154,000.
Executive chairman Don Goulding said the brands continued to perform well as the market started to recover from the effects of lockdown.
“Results for the half year are below those of 2020 due to sales lapping an extraordinary increase last year when the combination of lockdown, a hot summer and unusual trading conditions led to a significant surge in sales, particularly in the second quarter (July to September) when revenues advanced by 265% versus the prior year.
“Comparing sales for the half year to the same period in 2019 (pre Covid pandemic) we increased revenues by 75%,” he said.
The UK on-trade had had a successful reopening over the summer, and with the increase in confidence in the market, the company had seen new listing for its RedLeg Spiced rum range, as well as new retail listings for its TRØVE brand, with a premium retailer. The Duty Free market was also showing “encouraging signs of growth”.
“[We] expect to continue building on these provided the UK remains lockdown free,” he said. “Global lockdowns continue to ease and have largely ended in our key export markets, with the exception of Australia which is still experiencing restrictions.
However, Goulding warned that the widespread disruption and cost pressures associated with extensive labour shortages across the supply chain, production and distribution networks was likely to remain disrupted for the foreseeable future “particularly during the key Christmas trading period”
“These issues are likely to continue throughout the current financial year and will remain a priority. In addition, we are anticipating further cost of goods and energy price increases across the business, and endeavouring to maintain margins in light of this,” he said.
Administrative costs rose 10% to £338k due to one-off costs associated with the successful round of equity raising for investment in the Ardgowan Distillery Company, which will be home to a new malt whisky and gin brand, Blackwoods. The company is set to invest more than £3 million in the £11.4 million distillery, which is slated to open in 2023.
