SWEDEN: Vin & Sprit sees exchange rates hit H1
Vin & Sprit has posted a slight lift in its half-year figures, despite a hammering from exchange rate fluctuations.
The Swedish company said today that operating profit for the six months to the end of June was up by 4% on the corresponding period a year earlier, reaching SEK878m (US$127m). The increase came on the back of a 4% rise in organic sales, to SEK4.68bn.
Accounting for exchange rate fluctuations, however, group net sales slid by 3%, while operating profit was down by 19%.
At the V&S Absolut Spirits unit, operating profit was down by 2% to SEK844m and net sales by 2% to SEK 2.7bn. Volumes were up 4% to 5.4m 9-litre cases, primarily due to higher sales volumes for Absolut Vodka and Cruzan Rum. Absolut Vodka sales in its key US market fell during the six-month period, however, due to inventory reductions among distributors compared to the same period last year.
Operating profit in the V&S Distillers business area fell by 8% to SEK93m, while the V&S Wine unit saw operating profit slide by an unspecified percentage to SEK10m.
"It is my hope that we will see even better results for the group this year than last year," said group CEO Bengt Baron. "I base this on continued good sales development for Absolut Vodka, while we are also increasing efficiency throughout the group."
Speaking to just-drinks today, a spokesperson for V&S said: "We expect the full-year results to be better than last year's, but we don't give any special guidance on how many percent."
When asked for the latest news about the possible sale of the group by the Swedish government, the spokesperson said: "We have no comment whatsoever on that process. Morgan Stanley has been appointed and they are looking at different possibilities going forward and we will see what will happen from them." The spokesperson was unable to give a timescale for an announcement on the situation.
Among the potential parties lining up to buy V&S are Fortune Brands, Diageo, Pernod Ricard and Bacardi. Fortune is thought to be the front runner, with its Beam Global Spirits & Wine division handling the distribution of Absolut in the US.
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