Concha y Toro 2012-2016 - results data

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Late last week, Concha y Toro released its full-year results for 2016. The Chile-headquartered wine group saw the first six months prop up the full-year performance, as currency fluctuations triggered by June's EU referendum in the UK battered profits. Here, just-drinks considers CyT's performance over the last five years.

Concha y Toro's Full-Year Net Sales 2012-2016

Source: Company results

The group's top-line has been heading in the right direction consistently over the past five years, increasing by just under 47% between 2012 and 2016. The biggest jump came in 2014, when sales rose by almost 23% on the year before.

Sales have risen by single digits in the other four years, although 2016 delivered the lowest increase, of 3.5%.

Concha y Toro's Full-Year Net Sales by Region 2012-2016

Source: Company results

A breakdown by reporting region highlights the importance of export sales from CyT's Chilean operations. Indeed, the performance abroad of the likes of Casillero del Diablo was the clear driver behind 2014's sales jump. Domestically, CyT's wine sales are bolstered by its third-party distribution of spirits and beer.

Since acquiring the Fetzer wine business in California from Brown-Forman in 2011, the group has increased the unit's sales by more than a quarter.

Concha y Toro's Full-Year Export Volumes by Region 2012-2016

Central America8.
South America9.
The US1513.812.812.912

Source: Company results

The geographical split of CyT's total exports shows a continued reliance on Europe, which has regularly accounted for around 50% of export volumes. This reliance, as we shall see later, is not without its risks. Of mild concern will be the US, considered by many in the wine business to be a solid market with bags of potential - for CyT, the US has dipped from 15% of group exports in 2012 to 12% last year.

Asia, meanwhile has grown in relevance, and accounted for just under 14% of CyT's export volumes in 2016, up from less than 11% in 2012.

Concha y Toro's Full-Year Net Profits 2012-2016

Source: Company results

Do you hear the alarm bells? After three years of healthy growth, the brakes slammed on last year. From the 30% bottom-line jump in 2014 and the near-16% lift in 2015, net profits fell last year by 3.6%. The reason? The aforementioned reliance on Europe, specifically the UK. The country's decision in June to leave the European Union has wreaked havoc on the Pound's exchange rate, leaving CyT's bottom line battered and bruised. The hope must be that 2017 brings more certainty to the UK's situation although, having triggered the two-year exit process in late-March, such stability is unlikely in the short-term.

Concha y Toro's Full-Year Operating Profits 2012-2016

Source: Company results

The group's operating profits were also hit hard by external factors in 2016, again, after a far more positive period beforehand. That said, operating profits were flat last year, rather than down.

Sectors: Company results, Wine

Companies: Concha y Toro

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