(`CDG' or `the Company')
EPIC: CDGP
UNAUDITED RESULTS FOR THE SIX MONTHS ENDED 30th
Key highlights include:
-
Year on year sales up 15% to £5.716m (H1 2017: £4.977m)*
-
Chapel Down Wines and Spirits sales up 19% to £3.981m (H1 2017: £3.345m) - Curious Drinks Ltd Beer and Cider sales are up 6% to £1.735m (H1 2017: £1.632m)
-
- Wines and Spirits Gross Profit up 24% at £1.572m (H1 2017: £1.271m)
- Beer and Cider Gross Profit down 2% at £0.545m (H1 2017: £0.558m)
- EBITDA of £216k (H1 2017: £235k) as we continue to reinvest in our brands, infrastructure and supply
-
A Gold Outstanding medal at
The International Wine and Spirits Challenge 2018 Awards for our Kit’sCoty Coeur de Cuvee 2013 along with a Gold for our Kit’sCoty Blanc de Blancs and Gold medals at The Decanter World Wine Awards for our Kit’sCoty Blanc de Blancs and Kit’sCoty Coeur de Cuvee 2013 and our still Chardonnay 2013 -
Additional 102 acres of new vineyards planted on chalk terroir in
Kent -
Brewery build commenced and scheduled for completion in
March 2019 - In September we exchanged on an Agreement to Lease a further 388 acres of prime viticultural land adjoining our existing vineyards on the North Downs
-
In September we exchanged on an Agreement to Lease a 5,000 sqft site
in King’s Cross,
London by the Regent’s Canal where we will, subject to planning and licencing, be opening the “Chapel Down Gin Works” an experiential bar, restaurant and Gin Works
* Total of Wine, Beer and Cider sales
“The first half of 2018 has seen considerable change in the drinks
industry. We have seen the collapse of Conviviality and subsequent
re-birth of
Whilst we have been affected by all of the market challenges in different ways, we remain completely focused on delivering solid top line growth at good margins whilst we continue to invest strongly to ensure we continue to build strong and sustainable brands that our consumers and customers love.
It is encouraging that interest in English wines – and
With demand for our wines continuing to exceed our ability to supply, we
are greatly encouraged by the prospect of this years outstanding harvest
with record yields and excellent quality fruit. Whilst all the fruit is
not yet harvested, we can expect 40-60% more fruit than we have ever
received at quality levels to match the best vintages ever in
And that wine needs to be better than good. It needs to be great. So we have been busy improving our winemaking and equipment and systems and were delighted to scoop five golds, ten silvers and seven bronze medals in the three major international wine awards competitions (Decanter, International Wine and Spirit Challenge and International Wine Challenge) – a testament to our people, our investment and our relentless pursuit of excellence. We will be investing further over the coming years.
We have also been very encouraged by the results of our
In the beer market, Curious beers and cider have maintained the highest
standards of quality and we have continued to invest in our people and
marketing as we build out our new brewery at a highly visible site in
the centre of Ashford. The new brewery will give us greater control over
our growth and also bring improved margins and a highly visible point of
difference.
I am privileged to work with fantastic people – curious, fearless and relentless – but more importantly a great team. It’s the quality of those people, the excellence of our brands, the excitement of operating in growth markets and the support of an outstanding Board that makes us especially motivated about Chapel Down’s prospects for the future. The Company is changing gear as we build our brands and invest for the future.
We will continue to work to build a better business that excites consumers and investors.”
Performance Review
The combined business continued to perform well in the first half of 2018, with growth in sales and gross profit of the combined businesses:
|
Beer and Cider | Combined Businesses | |||||||||||||||||
H1 2018 | H1 2017 | %age Variance | H1 2018 | H1 2017 | %age Variance | H1 2018 | H1 2017 | %age Variance | |||||||||||
£’000 | £’000 | £’000 | £’000 | £’000 | £’000 | ||||||||||||||
Turnover | 3,981 | 3,345 | +19% | 1,735 | 1,632 | +6% | 5,716 | 4,977 | +15% | ||||||||||
Gross profit | 1,572 | 1,271 | +24% | 545 | 558 | -2% | 2,117 | 1,829 | +16% | ||||||||||
Gross profit %age | 39% | 38% | 31% | 34% | 37% | 37% |
We made a conscious decision to continue reinvesting any surplus cash in
our people, our systems and our brands. As a consequence, the total
business reported EBITDA of £216k, compared with £235k in the six months
to
Beer margins have declined following the forced change of our brewing partner in 2017 which has also limited our scope for short term volume growth whilst developing the brand and managing supply. At 31% gross margin from contracted out brewing, we are satisfied with its performance.
With a strong programme of sponsorships and support – The Boat Races,
Beer and Cider
Our growth has been focused on premium accounts and we see continuing
progress in top end restaurants, bars, hotels and premium off-trade. We
have national distribution through Majestic and
Beer and cider sales rose 6% to £1.735m in the first half. Gross profit fell by 2% due to changes in supply and relaunch of bottles and gross margins were therefore down to 31%. We expect gross profit to rise significantly when the new brewery opens.
Outlook
We operate in three exciting markets – English wines, premium craft beer and premium gin/vodka. We expect all three markets to continue to out-perform the drinks industry. We are well funded and will continue to invest and look to make the most of these opportunities over the coming years.
We have a growing experiential attraction at Tenterden and a new brewery to open next year only 38 minutes from Kings Cross where we are developing an exciting new Gin Works.
We are looking forward to the biggest and best quality harvest in English wines’ history.
We have invested wisely in developing good brands and outstanding people.
We have a highly supportive Board to guide us and a small army of engaged and enthusiastic shareholders.
Our tangible assets are strong and supportive of the business: land –
and high quality vined land in particular – continues to appreciate. We
have wine stock, equipment, vineyards and freehold winery and buildings
and a new freehold brewery being built just 38 minutes from Central
We enjoy the custom and support of our many passionate and engaged shareholders who continue to spread the word with energy and enthusiasm.
Thank you for your faith, your continued encouragement and your enthusiastic support. It makes a difference!
Contact
|
Chief Executive Finance Director |
01580 763 033 |
|||
finnCap Ltd
|
Corporate Finance ECM |
020 7220 0500 |
The information communicated in this announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) No. 596/2014.
PROFIT AND LOSS ACCOUNT FOR THE SIX MONTHS ENDED 30th
|
|||||||
Unaudited 6 months
|
Unaudited 6 months
|
Audited 12 months
|
|||||
Notes | 1 | 2 | 3 | ||||
£ | £ | £ | |||||
Turnover | 3,981,108 | 3,345,360 | 8,119,453 | ||||
Cost of sales | (2,408,954) | (2,074,056) | (4,875,034) | ||||
------------ | ------------ | ------------ | |||||
Gross profit | 1,572,154 | 1,271,304 | 3,244,419 | ||||
Administrative expenses | (1,594,687) | (1,242,581) | (2,698,528) | ||||
Share based payment | (21,093) | (37,434) | (75,416) | ||||
----------- | ----------- | ----------- | |||||
Operating profit/(loss) | (43,626) | (8,711) | 470,475 | ||||
Share of loss from associate | (314,239) | (89,830) | (226,329) | ||||
Interest | 29,630 | 6,576 | 8,969 | ||||
----------- | ----------- | ----------- | |||||
Profit/(loss) before tax | (328,235) | (91,965) | 253,115 | ||||
Tax | - | - | (130,704) | ||||
----------- | ----------- | ----------- | |||||
Profit/(loss) after tax | (328,235) | (91,965) | 122,411 | ||||
======= | ======= | ======= | |||||
EBITDA [excl. share based payment (FRS 102 section 26 adj)] | 216,075 | 235,411 | 967,734 | ||||
Profit/(loss) on ordinary |
(307,142) | (54,531) | 328,531 | ||||
Profit/(loss) per share – diluted (pence) | (0.22) | (0.08) | 0.11 |
Notes:
1. Represents the consolidated unaudited results for
2. Represents the consolidated unaudited results for
3. Represents the consolidated audited results for
CONSOLIDATED CASH FLOW FOR SIX MONTHS ENDED 30th
|
|||||||||||||
Unaudited | Unaudited | Audited | |||||||||||
6 months | 6 months | 12 months | |||||||||||
|
|
|
|||||||||||
£ | £ | £ | |||||||||||
Net cash generated from operating activities | (1,767,706) | (411,156) | 1,489,805 | ||||||||||
------------- | ------------- | ------------- | |||||||||||
Cash flows from investing activities | |||||||||||||
Payments to acquire tangible assets | (961,639) | (634,365) | (2,791,022) | ||||||||||
Interest received | 41,325 | 14,054 | 27,394 | ||||||||||
------------- | ------------- | ------------- | |||||||||||
Net cash from investing activities | (920,314) | (620,311) | (2,763,628) | ||||||||||
------------- | ------------- | ------------- | |||||||||||
Cash flows from financing activities | |||||||||||||
Issue of ordinary share capital | 1,432,500 | - | 17,813,368 | ||||||||||
New secured loans | - | 489,979 | 2,000,000 | ||||||||||
Repayment of loans | (1,969,937) | - | (30,063) | ||||||||||
Interest paid | (11,695) | (7,478) | (18,425) | ||||||||||
------------- | ------------- | ------------- | |||||||||||
Net cash used in financing activities |
(549,132) |
482,501 |
19,764,880 |
||||||||||
------------- | ------------- | ------------- | |||||||||||
Net (decrease)/increase in cash and cash equivalents |
(3,237,152) |
(548,966) |
18,491,057 |
||||||||||
Cash and cash equivalents at the beginning of the period | 19,716,585 | 1,225,528 | 1,225,528 | ||||||||||
------------- | ------------- | ------------- | |||||||||||
Cash and cash equivalents at the end of the period |
16,479,433 |
676,562 |
19,716,585 |
||||||||||
======== | ======== | ======== |
BALANCE SHEET AS AT |
||||||
Unaudited | Unaudited | Audited | ||||
As at | As at | As at | ||||
|
|
|
||||
£ | £ | £ | ||||
Fixed assets | 11,353,705 | 9,139,908 | 10,944,912 | |||
Current assets | 27,131,812 | 10,081,124 | 28,524,908 | |||
Creditors due within one year | (3,207,384) | (2,817,775) | (3,505,496) | |||
Creditors due after one year | (237,882) | (554,090) | (2,049,431) | |||
------------ | ------------ | ------------ | ||||
Net assets | 35,040,251 | 15,849,167 | 33,914,893 | |||
------------ | ------------ | ------------- | ||||
Called up share capital | 7,060,073 | 5,051,510 | 6,905,860 | |||
Share premium account | 25,792,217 | 8,554,912 | 24,513,930 | |||
Revaluation reserve | 1,125,336 | 1,179,120 | 1,144,652 | |||
Profit and loss reserve | 1,062,625 | 1,063,625 | 1,350,451 | |||
-------------- | -------------- | ---------------- | ||||
Shareholders’ funds | 35,040,251 | 15,849,167 | 33,914,893 | |||
========= | ========= | ========= |
1. BASIS OF PREPARATION/ACCOUNTING POLICIES
The Company’s interim report for the six months ended 30th
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 £21,093 (H1 2017: £37,434) resulting in a Group pre-tax loss of £307,142 (H1 2017: pre-tax loss of £54,531).
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 30th
• Fixed assets of £11,353,705 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, Court Lodge,
• £5,137,140 of stock is valued at cost being the lower of cost or net realisable value.
3. PROFIT PER SHARE
The calculation of the loss per share for the six months to
4. DISTRIBUTION OF THE INTERIM STATEMENT
Copies of this statement will be available for collection free of charge
from the Company’s registered office at
--ENDS--
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