Chapel Down reports strong sparkling wine growth in 2022 half-year results
Chapel Down has posted its 2022 half-year results, with English wine in its “ascendancy”, according to CEO Andrew Carter, as traditional method sparkling wine sales have risen 35% on the first half of 2021.
Chapel Down, England’s largest winemaker, has announced a strong financial performance in line with management expectations in the six months ended 30 June 2022.
Net sales revenues, which exclude duty, rose 4% to £6.88m (H1 2021: £6.61m). Traditional method sparkling wine showed a strong performance, up 35% on H1 2021. This growth offset the anticipated decline in lower margin still wine availability following a challenging 2021 harvest.
Sparkling wines now represents 72% of the company’s wine sales by value, compared with 61% in Chapel Down’s full year 2021 results.
Average selling prices increased by 21% as a result of two changes; the increased share of traditional method sparkling wines in the company’s sales mix, and price increases on both sparkling and still wines in April 2022. However, price increases had no negative impact on volume.
Chapel Down also has plans to increase its acreage. 15 hectares of vines were planted this year at the existing Boarley site, with plans to plant 48 more. This increase would amount to over 364 ha (900 acres) planted by this time next year, the largest in the English wine industry.
Andrew Carter, Chief Executive Officer of Chapel Down, commented: “The profitable growth achieved in the first half of the year was primarily driven by 35% growth in traditional method sparkling wine sales, as we delivered a substantial shift in our sales mix in line with our premiumisation strategy. Since the summer of 2021, we have been preparing for the impact of that year’s challenging harvest and the resulting lower availability of still wines in 2022. The exceptional growth of sparkling wine sales, together with the price increases in April, with no adverse impact on volumes, has supported the 51% gross margin achieved in the period.
“With a strong first half delivered, we look to the remainder of the year with confidence. Despite the evolving consumer backdrop, we continue to trade positively and expect to deliver net sales revenue growth and sustained margins for the full year. This, together with our positive 2022 harvest, ensures we are on track to meet our target of doubling the size of the business by 2026.”