TIDMCVR
RNS Number : 7210V
Conviviality PLC
07 November 2017
7 November 2017
Conviviality Plc
("Conviviality", the "Company" or the "Group")
Trading Update
Conviviality Plc (AIM: CVR), the UK's leading independent
wholesaler and distributor of alcohol and impulse, serving
customers through its franchised retail outlets and through
hospitality and food service, is pleased to provide an update on
trading for the 26 weeks to 29 October 2017.
Group unaudited revenue for the period was 9.2% ahead of last
year at GBP836m (H1 FY2017: GBP766m*) and 7.9% above the
corresponding prior period.
Conviviality is pleased to report that sales in each business
unit for the 26 weeks ended 29 October 2017 were notably above the
corresponding prior period:
-- Conviviality Direct sales up 6.9% over the corresponding
prior period to GBP540m (H1 FY2017 GBP500m*)
-- Conviviality Retail sales up 10.0% over the corresponding
prior period to GBP203m (H1 FY2017 GBP185m*)
-- Conviviality Trading sales up 9.6% over the corresponding
prior period to GBP93m (H1 FY2017 GBP82m*)
The Group continues to perform in line with the Board's
expectations for the 52 week period ending 29 April 2018.
Conviviality Direct:
Trading has strengthened as existing customers have recognised
the benefit of being able to fulfil all of their drinks purchases
through Conviviality Direct. This is evidenced by: -
-- 5.7% increase in revenue per outlet and 1.2% increase in the number of outlets served;
-- 425 new customers joining the Company as the advantages of
our extended choice, service and product availability become
increasingly recognised and
-- 5,100 customers have engaged with the newly upgraded digital
platform, enabling them to access the full product range in a way
that is easy to interact with and time saving.
We are pleased to report that, during the period, we experienced
an increase in sales to large national account customers with a
resultant shift in the Group's gross margin mix.
Conviviality Retail:
We are pleased to have achieved strong sales growth in
Conviviality Retail during the period, driven by our strategy to
focus on improving the quality of the store estate, as well as
increasing the number of multi-site franchisees. This is reflected
by:
-- a 53% increase in average sales per store opened in the six
month period, as the quality of new stores opened improved, both in
terms of location and proposition;
-- LFL sales continuing to improve in line with the Board's
expectations with LFL sales of +2.3% excluding tobacco and +0.4%
including tobacco. The decline in the tobacco market is being
partially mitigated by the increase in the vaping assortment, with
403 Franchise stores now retailing vape products; and
-- Multi-site franchisees continuing to maintain higher LFL
sales - on average 2.8% points higher than the rest of the
estate.
At the half year, the number of stores was 708 (FY2017: 713)
with store openings for the full year remaining in line with the
Board's expectations.
Conviviality Trading:
Revenues have strengthened as its customers increasingly
recognise the skill and talent of the team at managing the complex
premium wine category and utilising the exclusive supplier
agreements that Conviviality has to support their ranging plans.
Furthermore, the agency business in both spirits, soft drinks and
beers continues to grow as the natural scale and reach of the
Conviviality Group supports agency growth. In the first half of the
year, the business has supported 250 festivals and events, up from
181 in H1 FY2017.
IT & Systems
The Company continues to deliver the integration of Matthew
Clark and Bibendum PLB Group with the implementation of its ERP
system into Bibendum during the period. All business units will be
operating on the same ERP platform by the current financial year
end, however, in order to ensure the successful implementation of
the ERP system across the remainder of the Group, whilst ensuring
excellent service delivery, the system is being rolled out on a
more sequential basis during the year. The phasing of this will
result in the associated cost savings being more H2 FY2018 weighted
than previously anticipated.
Net Debt
Net Debt at the half year was GBP134m compared to GBP139m last
year.
Outlook
Conviviality continues to perform in line with the Board's
expectations for the 52 week period ending 29 April 2018. However,
reflecting the phasing of cost savings, profits for the full year
will be more H2 FY2018 weighted.
Conviviality will announce its Half Year Results for the 26
weeks to 29 October 2017 on 29 January 2018.
Diana Hunter, Chief Executive Officer of Conviviality, said:
"We are pleased to have delivered strong revenue growth during
the period. This performance is a direct result of the support and
engagement of our valued customers and Franchisees across our
entire business, our suppliers and global producers and the
talented teams who work closely with them.
"During this period the Company has undergone significant change
as we continue to implement systems that will ultimately serve to
future proof our business and enable us to continue to deliver the
outstanding service that our customers and Franchisees expect from
us."
*Prior year sales have been restated to reflect the adjustments
made in the financial year ended April 2017 relating to the
classification of retrospective sales rebates, listing fees and
franchise fees and the removal of inter segment revenues. In
addition, Conviviality Direct's festival business has been
consolidated with Conviviality Trading's festivals business and is
reported with Conviviality Trading and the prior year has been
restated accordingly. Bibendum PLB Group sales for the period 1 May
2016 to 19 May 2016 were incorrectly included in sales for the 26
weeks ended 30 October 2016 and have been removed. This correction
has no material impact on previously reporting profit.
Enquiries:
Conviviality Plc Tel: 01270 614 700
Diana Hunter, Chief Executive Officer
Investec (Nominated Adviser and Broker) Tel: 020 7597 5970
Garry Levin / David Flin / Daniel Adams
FTI Consulting Tel: 020 3727 1000
Jonathon Brill / Georgina Goodhew / Fiona Walker
This information is provided by RNS
The company news service from the London Stock Exchange
END
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November 07, 2017 02:00 ET (07:00 GMT)
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