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Weak rand helps South Africa's Distell's sales

Published:  25 February, 2014

The weakness of the rand helped South Africa's wine and spirit group Distell as revenue grew 15% on a sales volume increase of 5.5% in the first half of its financial year.

Distell, which owns the Nederburg wine brand, Amarula liqueur and Savanna cider, saw operating profit grow 13.4% in the six months to December 2013.

The group faced challenging times in its domestic market, with sales there rising by 5.2% by value and 3.1% by volume. It said the difficult economic climate "continued to curtail consumer demand" there. Sales volumes of its wine portfolio declined marginally in South Africa, it said.

Internationally, the picture was better, with sales volumes growing by 12.7% while revenue improved 48.9%, thanks to the weaker rand and the addition of the Burn Stewart Distillers portfolio of whiskies. The wine and spirits portfolios delivered growth of 6.4% and 54% respectively.

In April 2013, the groups acquired Burn Stewart Distillers, makers of Bunnahabhain whisky for £160 million from CL World Brands and Angostura.

In a statement, the group said: "We believe challenging trading conditions in many of our markets will persist for the remainder of the year. However, the strength, appeal and diversity of our brands, our enhanced capacity to trade across a spectrum of markets and the security of our financial position will allow us to continue pursuing our strategic course successfully."