S AFRICA: Distell targets cider to prop up wine

Most popular

The wine category in 2019 - just-drinks' Review

Interview - Diageo's chief digital officer - Pt I

3 cocktail trends for 2019 – Diageo's World Class

Constellation cuts losses on Ballast Point folly

Interview - Pernod Ricard CFO Helene de Tissot


Distell managing director Jan Scannell believes the company's cider sales will continue to thrive this year and offset a challenging European wine market.

Scannell (pictured), who leads the South African drinks group, was speaking after the company posted rising first-half sales and earnings. Distell saw revenues rise by over 16% to ZAR4.3bn in the six months to 31 December. Operating profit leapt 56% to ZAR698m.

Sales rose thanks to growing demand for Distell's spirits and cider brands and the company's ability to shrug off a tough domestic wine market.

Scannell told just-drinks yesterday (14 February) that Distell, which owns Savanna, South Africa's leading cider brand, will see its cider business go from strength to strength in 2007.

"In South Africa, cider is very much at the top end of the thirst-quench market," Scannell said. "We've seen very substantial growth in cider and there's no reason to think that won't continue in 2007."

Cider now accounts for around 25% of the company's sales. Scannell added: "It's a regional business and is driven by the South African market but we're also seeing very nice growth in the rest of Africa and into Europe."

Europe, however, will continue to present a challenge for Distell as it looks to grow its wine business outside South Africa, Scannell said.

The UK, Holland and Germany had been challenging wine markets in 2006, he noted. Focussing on the UK, Scannell said Distell, which owns wine labels including Nederburg and Durbanville Hills, had yet to secure a strong enough presence among the country's major retailers.

"The UK is quite small for us; we've been unsuccessful in breaking through and meeting the needs of the multiple grocers. South Africa is a price-driven category in the UK - that's something we're neither good at nor involved in."

Domestically, Distell saw wine sales rise 4% during the first half of the year thanks, Scannell said, to the company's brand building efforts amid an oversupply of wine particularly red varietals.

In North America, Scannell said Distell had strengthened the distribution of its wines via relationships with Brown-Forman and AV Imports.

Sectors: Beer & cider, Spirits, Wine

Companies: Distell, Brown-Forman

Related Content

"We've got to be a little different and break some of the moulds" - just-drinks meets Distell CEO Ri...

How did Distell perform in fiscal-2019? - results data

How did Distell perform in fiscal-2019? - results data...

"The mainstream part of our wine portfolio is incredibly important for Africa" - just-drinks meets D...

"The world has changed dramatically" - just-drinks speaks to Distell Group CEO Richard Rushton about...

Oops! This article is copy protected.

Why can’t I copy the text on this page?

The ability to copy articles is specially reserved for people who are part of a group membership.

How do I become a group member?

To find out how you and your team can copy and share articles and save money as part of a group membership call Sean Clinton on
+44 (0)1527 573 736 or complete this form..

Forgot your password?