Conviviality toasts 137% sales increase
Conviviality Retail has seen group sales increase 137% in the last 12 months, following a ‘transformational’ year, it revealed this morning.
The independent drinks wholesaler saw sales of £864m in the 53 weeks to 1 May, up from £364m, strengthened by strong trading across its retail business, and the acquisition of Matthew Clarke in October. Ebitda is expected to be ahead of market expectations, while net debt was around £87m, compared to last year’s net cash position of £1.2m at its year end.
Sales at Matthew Clarke were reported as ‘strong’, up 4.9%, with both customer numbers and the number of outlets supplied up by 2.9% since October.
On the retail side, Wine Rack saw like-for-like sales up 3.2%, while retail sales within franchised stores great by 1.3%, a slight slow-down on last year’s 1.7%. However the company’s retail estate was boosted to 716 during the year, a net increase of 92, after 126 new stores were opened, and 34 were closed, nearly half the number of the preceding year. There were 38 new franchises and around half of the estate (364) were owned by franchisees with multiple sites, an increase of around 42% on last year.
Wholesales sales within the division were flat, however.
Diana Hunter, chief executive officer of Conviviality Plc, described the year as “transformational” and said she was encouraged by both the company’s achievements as it transitioned to become the UK’s leading independent alcohol wholesaler, and the opportunities going forward.
“The acquisitions of Matthew Clark, Peppermint and Bibendum PLB Group enable Conviviality to fulfil its aim to satisfy all consumer drinking occasions, enabling it to have unrivalled insight and expertise as the drinks sector’s leading wholesaler and distributor,” she said.
Analyst Phil Carrol of Shore Capital said the positive update provided a good foundation for further progress next year.
“The acquisition of Bibendum should provide further scale and expertise,” he noted, adding that net debt was below the expected £90.6m forecast and store growth was also greater than expected.
Conviviality surprised the industry on the even of the London Wine Fair by announcing its acquisition of the Bibendum PLB Group for £60m, in one of the largest deals in the drinks industry.
Hunter told db that her aim for Conviviality had been realised with the acquisition, which has created a business with a turnover of £1.4bn that accounts for around 8% of the total UK on-trade, with sales just under £1bn, Hunter said.
At the acquisition, Bibendum PLB boss Michael Saunders confirmed all five trading companies within the Bibendum PLB Group are set to continue and operate within the wider Conviviality portfolio, alongside national wholesaler Matthew Clark, and Conviviality’s retail businesses, Bargain Booze and Wine Rack.
An update of the integration plan is currently being worked out and an update will be issued in July.