‘Weak’ first quarter for Stock Spirits

European spirits producer Stock Spirits has warned shareholders of its “extremely weak” performance in the first quarter of 2015.

One of Stock Spirits’ leading brands is its Prestige vodka (Photo: Stock Spirits)

The London-based company, which operates in Central and Eastern Europe, is blaming supply chain problems in Poland, one of its leading markets, as the chief reason for the poor results.

In a trading statement released before its annual general meeting, the group said that despite the reduction of vodka inventories by “key customers” in the country, its full-year results expectation remained unchanged.

“The first quarter was extremely weak, but we have been encouraged by the re-emergence of more normal trading conditions in the six weeks since Easter,” the statement read.

“In Poland, the market rate of decline in vodka consumption reduced slightly to 3.8% in the three months to March, versus 4.3% in 2014. We continued not to chase uneconomic sales and therefore have lost share.”

This is not the first time in recent months that the company’s Polish arm has caused problems. In its full year results in March, the company admitted that potentially €6 million of allegedly fraudulent payments were made within its Polish business over the last five years, in areas to do with marketing and the appointment of sales agencies.

The Stock Prestige vodka-maker also reported a 14% sales dive in 2014 – described as a “difficult year” – due to a 15% tax hike in Poland.

The group anticipates weak overall half-year results this year, which it hopes to offset with recovery in the second half.

Stock Spirits will report its half-year results for 2015 on 20 August.