SWEDEN: V&S thanks Cruzan and Danzka for H1 increases
V&S Group has seen H1 sales and profit rise impressively on the back of its Cruzan rum purchase.
The owner of Absolut vodka said today (18 August) that group net sales increased by 13% year-on-year to SEK5bn (US$695m) while operating profit leapt by 32% to SEK1.08bn.
Sales volumes for the six-month period were flat, however, at 11.9m 9-litre cases. The company blamed divestments and weaker sales of regional and local products for the figures.
The lift in sales values was credited to both organic growth and the acquisition of Cruzan in March this year. The higher US dollar exchange rate during the period was also credited, as it accounted for around one-sixth of the increase.
Turning to income, V&S highlighted that around half of its half-year profits came from the sale of Danzka vodka earlier this year to French spirits group Belvedere.
The group's V&S Absolut Spirits unit saw sales rise by 13% in value terms and by 11% in volume terms. Operating profit saw only a 6% climb to SEK860m due to lower profitability in the newly-acquired operation and to one-off expenses for restructuring of the sales organisation.
V&S Distillers, which encompasses the group's spirits activities in the Nordic region and Central Europe, saw sales slip by 3% in value and 7% in volume. The decline was blamed on the sale of local brands in the Czech Republic and to smaller decreases on a number of markets, primarily Denmark. Operating profit, however, was up by 13% to SEK101m.
Finally, the group's wine operations posted a slide in sales - both value and volume were down by 6% each. The unit lost a Swedish wine agency and reduced subcontracted bottling in Denmark in the period. Operating profit leapt, however, from SEK9m a year ago to SEK25m.
The group also said that in July it topped up its stake in Beam Global Spirits & Wine by spending US$153m in shares. V&S subsequently retains its 10% in the company that it purchased when the parties entered into joint distribution agreements in 2001.
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