Chapel Down wine sales soar
Chapel Down has reported a 20% increase in its wine sales alongside a 7% increase for its associated Curious Drinks beer and cider arm.
The English producer said sales of its wine soared to £8.2 million for the year ending 31 December, 2017 - up from £6.8 million the previous year, while its cider and beer sales rose from £3.4 million in 2016 to £3.7 million.
Wine gross profit were 12% at £3.2 million in the year, with beer and cider gross profit up 11% at £1.2 million.
Combining the two, total year-on-year sales increased 15% to £11.8 million from £10.2 million in 2016.
The sales growth would enable Chapel Down to “invest the proceeds to build the business whilst still delivering growth in EBITDA (+29% vs 2016)”, said chief executive, Frazer Thompson.
“With seven years of strong compound growth, Chapel Down is maturing to become a player with serious potential in growth markets. We are seeing good demand for English sparkling wines in sophisticated international markets and we enjoyed our first full year in the USA, reaching our target of 10,000 bottles of sparkling wine with ease,” he said.
He put a slight decrease in gross margin on wine down to euro exchange rates and increased cost of raw materials.
In terms of export, the business was developing some “exciting long term opportunities”, he said, particularly the US where it hit its first year sales target of 10,000 bottles.
“We are also growing our direct sales through our own shop, direct online sales, events and pop-ups where we can bring a Chapel Down experience to consumers. Sales in the shop were up 16% to £1.5 million and our pop-up at Bluewater added £170,000 to sales,” he said.
On the back of international accolades and “very strong demand from a consumer seeking something more interesting and distinctive than Champagne”, Chapel Down said it was confident in its plans to double the acreage of vineyards supplying it to over 1,000 acres over the next three to four years.
The company estimated that Chapel Down represents over half of the growth in English sparkling wine in the off trade.
The business said it would be making “substantial investments” over the coming years in vineyards, the brewery, commercial infrastructure, people and marketing to ensure that it is best placed for future growth and any industry consolidation.
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