Stock Spirits warns that Polish duty increase will hit 2014 sales

Oliver Smith
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STOCK Spirits Group, the central and eastern European spirits producer that listed on the London Stock Exchange in October, warned that sales and earnings in 2014 would be hit by an expected increase in alcohol duty by Poland.

The 15 per cent tax increase from 1 January was expected and the firm said that performance in the fourth quarter and 2013 as a whole was in line with expectations in a trading update yesterday.

“As expected, the impact upon the group of the duty increase will have been to increase reported sales and earnings before interest, taxes, depreciation, and amortization (Ebitda) in 2013 and to reduce reported sales and Ebitda in 2014,” said chief executive Christopher Heath.

The firm’s full-year 2013 results are set to be in line with expectations, due to a strong end of the year, and Heath said the firm “remain[s] excited about the group’s opportunities for future growth in Central and Eastern Europe”.

Stock Spirits, which is the biggest vodka producer in Poland and the Czech Republic, raised £52m last year from the sale of new shares to pay down debt.

Its majority-owner Oaktree Capital Management and the company’s management had raised £206.5m by selling down their stakes during the initial public offering.

Shares in Stock closed down one per cent at 282.25p.