US/RUSSIA: CEDC continues to struggle as Q1 figures slide
- Q1 net profits of US$62.5m versus $1.1m in Q1 2010
- Operating profits in three months to end of March drop from $9.4m to a loss of $3.1m
- Sales slip by 5.4% to $148.2m
- CEDC focused on "management challenges" in Russian business
Central European Distribution Corp issued its Q1 numbers earlier today
Central European Distribution Corp (CEDC) has seen net profits leap, although underlying figures for the period continue to cause concern.
The spirits company said earlier today (10 May) that net profits for the three months to the end of March hit US$62.5m a US GAAP basis, versus $1.1m in Q1 2011. On a comparable basis, however, CEDC announced net losses of $21.4m for the quarter, compared to net losses of $17.4m a year earlier.
Operating profits plunged into the red, dropping by $12.5m to an operating loss of $3.1m. Sales also fell, by 5.4% to $148.2m.
Last month, Russian Standard injected up to $310m into CEDC in return for a 28% stake. It followed what CEDC called management challenges in its Russian business.
"We look forward to continued negotiations on this potential combination of businesses [with Russian Standard] as well as other operational synergies that we believe we could achieve,” said CEDC president & CEO William Carey.
“We certainly recognise the challenges we face in Russia and strongly believe that our new management team, with extensive Russian FMCG experience, is more than capable of driving the necessary changes needed in our Russian business today to begin to show improved results.”
For the company’s official announcement, click here.
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