Profit warning

Whisky curator’s shares crash as China sales fall

Scotch Malt Whisky Society
ASC owns the Scotch Malt Whisky Society which has seen sales falter

Shares in the Scotch Malt Whisky Society owner fell sharply in early trade after it said weaker-than-expected sales in China and a disappointing programme launch meant it would miss full-year revenue targets.

The Artisanal Spirits Company (ASC) said 2023 sales will be around £23m, up from £21.8m the year before, but below the £25m consensus.

While the company’s chief executive sought to reassure the markets that the business model was “robust”, he accepted that the “phasing of growth would be deferred by a year”. The shares were as much as 21% lower before closing 9p (15.65%) down at 48.5p.

The company said that the SMWS now has more than 40,000 members, describing it as a “significant milestone in its 40th year”.

However, revenue growth accelerated from 3% in the first half, but second-half growth failed to meet the ambitious 25% target due to weak sales in China in the fourth quarter, and poor sales from its 50th anniversary member cask sales programme announced last month.

Whilst generating a positive contribution this year, the new cask sales will not be at the anticipated level by the 31 December 2023 year end.

Andrew Dane
Andrew Dane: performance was ‘disappointing’

It said the company was well-positioned for growth but was facing wider macroeconomic market conditions.

Adjusted EBITDA would be “around breakeven” for the year, compared with earnings of £0.4m in 2022.

Chief executive Andrew Dane called the fourth-quarter performance “disappointing” but said the business performed well and in line with expectations.

“Our model is robust, throughout FY23 we have ensured that we have the right cost base for the business, we are well financed and we remain confident of future profitable growth,” he said.

Comment: Investors need to show a little more faith

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