Purcari - Revenues on the rise, profit on the decline in the first quarter

Wine producer Purcari Wineries (WINE) reported revenues of 91 million lei in the first three months of this year, 12% more than in the same period last year, while net profit fell by 17% to nine million lei, according to the issuer's report published yesterday on the Bucharest Stock Exchange (BVB) website.

The comparison also includes sales recorded last year by Ecosmart, of five million lei, a currently deconsolidated business.

Alexandru Filip, CEO of Purcari Wineries, said: "The focus on strengthening the value of the brands, a well-calibrated pricing policy and operational agility continue to generate positive results. We have continued to invest in the development of our assets and capabilities. Building on a solid foundation and strategic partnerships in development, we remain confident in our ability to meet both the full-year and medium-term objectives."

Sales in Romania increased by 26%, while sales in the Republic of Moldova were 13% higher compared to those in January-March last year and double compared to those in the first quarter of 2020, through a solid performance in modern trade. Sales in Bulgaria increased by 25% compared to those in the first quarter of last year, due to the expansion in traditional trade and HoReCa, as well as the listing of two brands. In the Czech Republic and Slovakia, sales increased by 27%, while Ukraine recorded a 26% increase compared to the first quarter of last year.

Cost of sales amounted to 50.4 million lei, 10% more than in the first three months of last year. Marketing expenses increased by 21%, to 13.1 million lei, while general and administrative expenses increased by 35%, to 11.5 million lei. Operating profit amounted to 15.9 million lei, 2% more than in the first three months of last year.

On the other hand, financial costs amounted to 4.4 million lei, more than double compared to those in the first three months of last year, of two million lei, amid a 32% increase in interest expenses, up to 2.7 million lei, the company also recording a net foreign exchange expense of 1.7 million lei.

Victor Bostan owns, through Amboselt Universal, 20% of the wine producer from the Republic of Moldova, whose stock market valuation amounts to almost 550 million lei.