Conviviality has hailed a return to profit during its first half, despite a fall in like-for-like retail sales.
The Wine Rack and Bargain Booze owner posted a pre-tax profit of £7.4m for the 26 weeks to October 30, 2016, compared with a £4m loss during the same period the previous year.
Total revenues more than trebled to £782.5m, from £252m, while gross margin climbed by 2.5 percentage points.
The turnaround in fortunes was driven by its Conviviality Direct wholesale division, which registered a 5.2% increase in sales year-on-year.
Conviviality completed the acquisition of Bibendum during the period, having already snapped up fellow supplier Matthew Clark to boost its wholesale business.
Its retail arm also recorded an uplift in total sales, although they grew at the slower rate of 2.5%, but like-for-like sales across its 700-strong store estate fell 1.7%.
However, its Wine Rack and Bargain Booze fascias enjoyed a 2.1% uplift in like-for-likes during the crucial Christmas trading period, covering the six weeks to January 1.
Three divisions
Conviviality split into three divisions following the acquisitions of Matthew Clark, Bibendum and outdoor events business Peppermint.
Its wholesaling arm Conviviality Direct runs alongside its retail operations and festivals and events business Conviviality Trading, which had a 5.1% increase in sales.
Conviviality chief executive Diana Hunter said its acquisition strategy had left the business “well positioned in its market with a resilient business model”.
Hunter added: “These strong results demonstrate our competitive advantage, the broad customer base we have developed and the robust nature of Conviviality as the UK’s leading drinks wholesaler, distributor and solution provider to our customers.
“We have successfully restructured to create three business units Conviviality Direct, Conviviality Retail and Conviviality Trading, each providing our customers and franchisees with unrivalled range, expert service and advice to meet their customer needs while providing our suppliers with unmatched access to routes to market across both the on- and off-trade.”
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