Chapel Down expects to return to profitability this year after bumper Christmas trade was followed by a strong start to 2025.
A poor 2024 harvest driven by wet summer weather saw the winemaker take a £750,000 hit in October, while net sales revenue slipped 5 per cent to £16.35million for the year amid one-off factors in the off-trade, such as retailer stock reductions.
Chapel Down’s adjusted earnings before nasties slumped 58 per cent to £2.42million, driven by lower gross profit and the non-cash in-year fair value adjustment on biological produce.
But the business expects to return to profit this year after enjoying a strong start to 2025.
The Kent-based group said it was ‘currently trading well ahead of prior year’ and expected ‘strong sales growth for the year, with a return to full profitability’.
It also unveiled a new agreement with for the distribution of its sparkling wine in the US.
Winemakers in England suffered the second-worst harvest on record last year, with wet weather and disease hitting yields.
The wine producer’s net debt increased by 641 per cent to £9.2million amid new vine plantings and increased stock levels from the 2023 harvest.
Results: Chapel Down saw its net sales revenue and EBITDA fall in the year to 31 December
Its gross margin for the year came in at 48.4 per cent, down from 51.8 per cent the previous year, in part, due to ‘a greater proportion of still wines in the sales mix’.
The group announced a new agreement with Jackson Family Wines for the distribution of sparkling wines into the USA. he group said the US was ‘our largest potential export market.’
Chapel Down said the agreement was part of a ‘range of options to further optimise distribution’ in international markets.
It is unclear how the deal will be affected by Trump’s 10 per cent tariff on all goods going into the US.
Looking ahead, Chapel Down, said: ‘The consumer environment remains uncertain, but Chapel Down is currently trading well ahead of prior year and expects strong sales growth for the year, with a return to full profitability.’
Chairman Martin Glenn, added: ‘Whilst 2024 was a tougher year for Chapel Down following the outstanding performance seen in the previous year, the business performed creditably, making continued strategic and operational progress.’
‘As part of our refocus on wine, we significantly transformed our operations to lay the foundations for future growth, including organisational structures and culture, as well as our core business systems, processes and data.
‘These actions were difficult, and at times painful, but we benefited greatly from their successful delivery.’
James Pennefather, chief executive of Chapel Down, said: ‘I am delighted to join Chapel Down at a pivotal time in the development of the English wine market.
‘As the global reputation of England as a wine-making region grows, especially in the sparkling wine category, we have a rare opportunity to establish Chapel Down as a celebrated wine brand of international acclaim.
‘With our experienced team, portfolio of exceptional wines and a clear strategic focus, we are well positioned to grow both domestically and internationally.’
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