(`CDG' or `the Company')
EPIC:
CDGP
AUDITED RESULTS FOR THE YEAR ENDED 31st
Chairman’s Statement
I am delighted to announce another period of progress in the results for
the year ended
Key highlights:
-
Year on year sales up 15% to £11.796m (2016: £10.233m)*
- Chapel Down Wine sales up 20% to £8.119m (2016: £6.791m)
-
Beer and Cider sales, in the associate company
Curious Drinks Ltd , up 7% to £3.677m (2016: £3.442m)**
- Wine gross profit up 12% at £3.244m (2016: £2.888m)
-
Beer and Cider gross profit (in the associate company
Curious Drinks Limited ) up 11% at £1.224m (2016: £1.099m) - Continuing EBITDA up 29% to £968k (2016: £750k)*** as we continue to reinvest in our brands, infrastructure and supply
-
Successful Fundraise of £18.53m through the issue of new shares (the “Fundraising”)
in
December 2017 and launched an Open Offer to existing shareholders raising a further £1.47m (the “Open Offer”) -
50 acres of new vineyards planted on our leased sites in
Kent -
A Gold medal at The International Wine and Spirits Challenge 2017
Awards for our Kit’s
Coty Coeur de Cuvee 2013 - Outstanding initial results from our Spirits’ launch
* |
Includes Beer and Cider sales in our associate company |
|
** |
In |
|
*** |
Excludes the effect of the FRS 102 Section 26 share option accounting adjustment of £75k (2016: £75k) which is a non-cash item. |
|
Your company continued to build its most important assets - its brands - through innovative and well executed marketing, high profile sponsorships and publicity and a differentiated and creative approach to all our activities.
The new injection of £20m combined with the further enhancement of an outstanding management team is a measure of our intent. There is much to be done.
We will be making substantial investments over the coming years in vineyards, the brewery, commercial infrastructure, people and marketing to ensure that we are best placed for future growth and any industry consolidation.
Our assets are supportive of the business: land – and high quality vined
land in particular – continues to appreciate; our brand assets are more
valuable than ever; and our balance sheet is extremely strong. We enjoy
the custom and support of our many shareholders who tell the
Chairman
Chief Executive’s Commentary
Your company has continued to invest in its brands, its assets and its people to build a healthier, more sustainable and highly innovative drinks company with a really exciting future both at home and abroad.
With sales growth of 15% in the group (up 20% on wine and up 7% on beer
and cider), we are able to invest the proceeds to build the business
whilst still delivering growth in EBITDA (+29% vs 2016). With 7 years of
strong compound growth,
Performance Review
The combined business continued to grow in sales and gross profit of both Wine and Beer and Cider in 2017:
Wine | Beer and Cider | Combined Businesses | ||||||||||||||||||
FY |
FY |
%age |
FY |
FY |
%age |
FY |
FY |
%age |
||||||||||||
£’000 | £’000 | £’000 | £’000 | £’000 |
£’000 |
|||||||||||||||
Turnover | 8,119 | 6,791 |
+20% |
3,677 | 3,442 |
+7% |
11,796 | 10,233 |
+15% |
|||||||||||
Gross profit | 3,244 | 2,888 |
+12% |
1,224 | 1,099 |
+11% |
4,468 | 3,987 |
+12% |
|||||||||||
Gross profit %age | 40% | 43% | 33% | 32% | 38% | 39% | ||||||||||||||
We have made a conscious decision to continue reinvesting any surplus
cash in our people, our systems, and our brands. Nonetheless the total
business reported Continuing EBITDA of £968k***, up 29% compared with
£750k*** in the year to
Gross margin on wine was slightly down due to euro exchange rates and increased cost of raw materials, but remains very healthy.
We believe that there is great potential in our brands. They are well positioned, well managed and in attractive growth markets. We will accelerate our investment in planting new vineyards on the finest land, develop our winery and tourism infrastructure, build out our new brewery in Ashford and continue to innovate and excite the drinks business with initiatives like our gin and vodka.
In addition to being cited as one of the London Stock Exchange’s 1000
Companies to Inspire Britain, we are members of the influential
Wine
Wine sales grew 20% in the year to £8.119m. We have broad premium
distribution and a strong base of distribution partners, which include
Our sparkling wines continue to set the standard for the industry. They
are widely available in the on and off trade and supported by headline
events and sponsorships such as The Boat Race, Royal Ascot,
In the vineyards we continue to improve the quality of the wines we make through the management of our own vineyards and the spread of good practice with our 24 partner vineyards. We apply the most modern viticultural techniques to ensure we get the finest fruit.
In the winery, the fruit is being made into the best possible wine through the expertise of a young winemaking team who use the latest technology and equipment. In a highly competitive market, both vineyard and winery teams are constantly challenged to surprise and delight, and that spirit is reflected in the innovative wines and products that we have created to ensure we remain at the forefront of consumer’s minds. And they find us thanks to the wide availability and constant stream of exciting news about the company and its brands.
The recent fundraise has enabled us to secure an exciting future. We will continue to invest in creating further high quality supply from the best sites we can find. We have planted a further 50 acres this Spring taking the total planted on long term leased land to 172 acres since 2015. We now have 533 acres of vineyard planted from which to source our fruit We will continue to invest in further capacity and equipment to enhance efficiency and quality in the winery over the coming years, improving our systems and processes as well as building a world class brand and team.
Beer and Cider
Beer and cider sales in our associate company,
Our growth remains focused on premium accounts - top end restaurants,
bars, hotels and premium off trade. We have national distribution
through Majestic and
We have a unique and distinctive consumer proposition – a winemaker’s
beer – which is increasingly rare in an exciting and fast-growing beer
market. This real point of difference along with the ambition of the
team have been enhanced by the addition of a new Managing Director for
Beer and Cider,
Our real point of difference and our appeal to a broad church of
consumers give us a fantastic opportunity. The construction of the new
brewery and visitor facility in Ashford is progressing well and should
start test brews at the end of 2018 and open in the first quarter of
2019. It is just 38 minutes from
Business risks and uncertainties
Brexit has had no significant impact on our business to date. We would be affected, like all agriculturally based businesses, if we were not able to access EU workers for our viticulture. We are lobbying as an industry and are confident that there will be a solution given the strategic and cultural importance of a strong domestic food and drink industry and the growing importance of tourism to our economy. Nevertheless, we believe that maintaining and developing a strong brand and building a team of very high quality people are our best defence and we will continue to invest wisely to ensure we are best placed and risk is minimised.
There is a risk of a poor harvest through extreme weather events which we mitigate through maintaining the highest standards of viticulture, choosing the very best sites and utilising the latest proven advances in technology and agriculture. We source from a wide geographic area to minimise micro-climatic variations that can blight individual sites. The diversification into beer and spirits also further protects our ability to continue to grow. The risk of a poor hop harvest also exists and the group mitigates this risk by buying forward contracts on its key hops.
Competition continues to grow but we continue to invest in our people, brands and distribution to ensure that the business can continue to thrive.
Outlook
We are lucky to work in a great business. Our drinks are social glue. They tell a story. They are delicious. They are a reason to get together.
We are passionate about growing that congregation – introducing uniquely delicious products to enlightened consumers everywhere.
We are on a pilgrimage to get drinkers to fall in love with our brands so we can share their most special moments with them.
We think there is little point in just simply trying to be the best. That’s simply not good enough any more. We have to be the only people who can do what we do. That excites us and that’s what makes our brands stronger.
We think we have something special. Big brands are under attack as never
before from products and brands that are more exciting. Brands that are
more interesting and interested. Brands that have a relevant and
engaging story to tell. Brands that have a real point of difference.
Brands that try harder. Brands like
The launch of Kits Coty premium wines and the consumer and trade
interest in
Beer and cider growth will be accelerated as we build out the brewery and create more interest and engagement around the Curious brand. Recent listings in Tesco and on trade chains are exciting.
Last year we saw the opportunity to add a winemaker’s expertise to the
growing gin and vodka industry and created
Finally – to all our shareholders, thank-you. Its great to see so many of you using your shareholder benefits to get great discounts on our wines, beers and spirits. The energy, support and excitement that you create is something the whole team appreciate.
So let’s raise a glass. To you. To us. The curious optimists. The believers.
Chief Executive Officer
***Excludes the effect of the FRS 102 Section 26 share option accounting adjustment of £75k (2016: £75k) which is a non-cash item. Refer to note 1 “Basis of preparation/accounting policies” for further information.
Contact
|
|
|||||||
|
Chief Executive |
01580 763 033 |
||||||
|
Finance Director |
|
||||||
finnCap Ltd |
|
|||||||
|
Corporate Finance |
020 7220 0500 |
||||||
|
Corporate Broking |
|
||||||
The information communicated in this announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) No. 596/201.
PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 31ST
|
||||||||||||||
Audited Continuing |
Audited Discontinued |
Audited
Total |
Audited Continuing |
Audited Discontinued |
Audited
Total |
|||||||||
1 | 2 | 3 | 4 | |||||||||||
£ | £ | £ | £ | £ | £ | |||||||||
Turnover | 8,119,453 | - | 8,119,453 | 6,791,014 | 539,356 | 7,330,370 | ||||||||
Cost of sales | (4,875,034) | - | (4,875,034) | (3,903,342) | (369,555) | (4,272,897) | ||||||||
------------ | ------------ |
------------ |
------------- | ------------- | ------------- | |||||||||
Gross profit | 3,244,419 | - | 3,244,419 | 2,887,672 | 169,801 | 3,057,473 | ||||||||
Administrative expenses | (2,698,528) | - | (2,698,528) | (2,466,688) | (211,950) | (2,678,638) | ||||||||
Share based payment | (75,416) | - | (75,416) | (74,868) | - | (74,868) | ||||||||
----------- | ----------- | ----------- | ------------- | ------------- | ------------- | |||||||||
Operating profit/(loss) | 470,475 | - | 470,475 | 346,116 | (42,149) | 303,967 | ||||||||
Share of loss from associate | (226,329) | - | (226,329) | (27,805) | - | (27,805) | ||||||||
Gain on disposal | - | - | - | - | 466,903 | 466,903 | ||||||||
Interest | 8,969 | - | 8,969 | 22,061 | - | 22,061 | ||||||||
----------- | ----------- | ----------- | ------------- | ------------- | ------------- | |||||||||
Profit before tax | 253,115 | - | 253,115 | 340,372 | 424,754 | 765,126 | ||||||||
Tax | (130,704) | (130,704) | (111,691) | (6,613) | (118,304) | |||||||||
----------- | ----------- | ----------- | ------------- | ------------- | ------------- | |||||||||
Profit after tax | 122,411 | - | 122,411 | 228,681 | 418,141 | 646,822 | ||||||||
======= | ======= | ======= | ======= | ======= | ======= | |||||||||
EBITDA [excl. share based payment (FRS 102 section 26 adj)] | 967,734 | - | 967,734 | 749,593 | (20,232) | 729,361 | ||||||||
Profit on ordinary activities before taxation [excl. share based payment (FRS 102 section 26 adj)] | 328,531 | - | 328,531 | 415,240 | 424,754 | 839,994 | ||||||||
Profit per share – diluted (pence) | 0.11 | 0.60 | ||||||||||||
Notes: |
||||
1. |
Represents the consolidated audited results for |
|||
2. |
Represents the audited results for |
|||
3. |
Represents the Discontinued Operations being the |
|||
4. |
Represents the consolidated audited results for |
|||
|
||||||
CONSOLIDATED CASH FLOW FOR THE YEAR ENDED 31st
|
||||||
Audited | Audited | |||||
12 Mths | 12 Mths | |||||
|
|
|||||
£ | £ | |||||
Net cash generated from operating activities | 1,489,805 | (253,476) | ||||
------------- | ------------- | |||||
Cash flows from investing activities | ||||||
Payments to acquire tangible assets | (2,791,022) | (1,604,830) | ||||
Cash disposed of on deemed disposal of subsidiary | (250) | |||||
Interest received | 27,394 | 22,061 | ||||
------------- | ------------- | |||||
Net cash from investing activities | (2,763,628) | (1,583,019) | ||||
------------- | ------------- | |||||
Cash flows from financing activities | ||||||
Issue of ordinary share capital | 17,813,368 | - | ||||
New secured loans | 2,000,000 | - | ||||
Repayment of loans | (30,063) | - | ||||
Interest paid | (18,425) | - | ||||
------------- | ------------- | |||||
Net cash used in financing activities |
19,764,880 |
- |
||||
------------- | ------------- | |||||
Net (decrease)/increase in cash and cash equivalents |
18,491,057 |
(1,836,495) |
||||
Cash and cash equivalents at the beginning of the period |
1,225,528 |
3,062,023 |
||||
------------- | ------------- | |||||
Cash and cash equivalents at the end of the period |
19,716,585 |
1,225,528 |
||||
======== | ======== | |||||
|
||||||
BALANCE SHEET AS AT 31st |
||||||
Audited | Audited | |||||
As at | As at | |||||
|
|
|||||
£ | £ | |||||
Fixed assets | 10,944,912 | 8,802,062 | ||||
Current assets | 28,524,908 | 9,654,755 | ||||
Creditors due within one year |
(3,505,496) |
(2,424,615) |
||||
Creditors due after one year |
(2,049,431) |
(128,504) |
||||
------------ | ------------ | |||||
Net assets | 33,914,893 | 15,903,698 | ||||
------------ | ------------ | |||||
Called up share capital | 6,905,860 | 5,051,510 | ||||
Share premium account | 24,513,930 | 8,554,912 | ||||
Revaluation reserve | 1,144,652 | 1,183,283 | ||||
Profit and loss reserve | 1,350,451 | 1,113,993 | ||||
-------------- | -------------- | |||||
Shareholders’ funds | 33,914,893 | 15,903,698 | ||||
========= | ========= | |||||
1. BASIS OF PREPARATION/ACCOUNTING POLICIES
The Company’s report for the year ended
The accounting standard requires the Company to restate its profit to attribute a notional cost of non-cash share option agreements to the business. After adopting the standard, the accounts show a decrease in profit of £75,416 (2016: £74,868) resulting in a Group pre-tax profit of £253,115 (2016: pre-tax loss of £765,126).
The Company is required to value net assets in accordance with the
Company’s reporting standard (
The statutory accounts for the year ended
2. BALANCE SHEET REVIEW
The net asset value of the Company as at 31st
• Fixed assets of £10,944,912 includes the 2015 market value of the
sites at Tenterden and Kit’s Coty as well as the vineyard development
expenditure at Kit’s Coty and at
• £4,561,202 of stock is valued at cost being the lower of cost or net realisable value.
3. PROFIT PER SHARE
The calculation of the profit per share for the year ended
4. DISTRIBUTION OF THE FULL YEAR STATEMENT
Copies of this statement will be available for collection free of charge
from the Company’s registered office at
View source version on businesswire.com: https://www.businesswire.com/news/home/20180422005099/en/
Source: