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Interim Results 2021

Download the full Interim Results statement (PDF 0.90MB)

Stock Spirits Group PLC

Results for the six months ended 31 March 2021

Continued resilience in a challenging trading environment

12 May 2021: Stock Spirits Group PLC (“Stock Spirits” or the “Company” or the “Group”), a leading owner and producer of branded spirits and liqueurs that are principally sold in Central and Eastern Europe and Italy, announces its results for the six months ended 31 March 2021.

Financial and Operational Highlights

All values in € millions
unless otherwise stated
Reported six months to March 2021   Reported six months to March 2020 % Movement
Volume (millions 9 litre cases) 8.3   8.1 +2.0%
Revenue 183.4   189.6 -3.3%
Revenue growth at constant currency1       +0.3%
Adjusted EBITDA2 44.5   45.6 -2.4%
Adjusted EBITDA at constant currency       +1.7%
Operating profit before exceptional items 37.9   38.8 -2.3%
Profit for the period 28.1   14.7 +91.6%
Earnings per share - basic (€ cents per share) 14.11   7.41 +90.4%
Adjusted EPS - basic3 (€ cents per share) 14.11   14.38 -1.9%
Net debt 38.3   55.4 -30.9%
  • Year-on-year growth in market shares in the off-trade in our core markets of Poland and the Czech Republic - a resilient performance despite COVID-19 lockdowns closing or heavily restricting the on-trade channel for almost the entire period (6% of the Group’s revenue in the first half compared to a normal level of 15%)
  • Continuing positive momentum in Poland, our largest market (57% of Group revenue), achieving a five-year-high value market share of 30.7% as at March 20214 in the important vodka category, with revenue up +4.3% and EBITDA up +6.8% on a constant currency basis
  • Czech business (25% of Group revenue) has been impacted the most by on-trade closure, and local competition has increased: revenue declined by 13.6% and EBITDA by 21.2% both on a constant currency basis, although the business grew value market share to 33.5% as at March 2021 (on a MAT basis), from 33.3% in March 2020
  • Italy (10% of Group revenue) is benefitting from increased scale, with a strong contribution from the Distillerie Franciacorta acquisition completed in 2019, with value market share up in all our categories
  • Interim dividend of 2.98 € cents per share, an increase of +7.6% (2020 interim: 2.77 € cents per share)
  • Strong balance sheet with low leverage and unused committed bank facilities. Net debt of €38.3m at 31 March 2021 (30 September 2020: €22.7m), resulting in leverage of 0.55x (30 September 2020: 0.32x)
  • The Group’s €200 million financing facilities have been renewed and now run to May 2024, with the possibility to extend up to 2026

1 Constant currency is calculated by converting the prior period results at current period FX rates

2 The Company and its subsidiaries, Stock Spirits Group (the “Group”) uses alternative performance measures as key financial indicators to assess underlying performance of the Group. Details of the basis of calculation for Adjusted EBITDA can be found in note 6 to the Unaudited Interim Condensed Consolidated Financial Statements

3 Adjusted basic EPS excludes the impact from exceptional items

4 Value market share on a moving annual total (MAT) basis


Commenting on the results, Mirek Stachowicz, Chief Executive Officer, said:

“This has been another resilient financial and operational performance against a hugely challenging backdrop. We managed to largely counterbalance the widespread closure of the on-trade in all of our markets by growing our strong brands in the off-trade. This was driven both by successful product innovations and by the trend for consumers to turn to familiar and trusted brands during times of uncertainty.

We are broadly on track with our plans for the year, notwithstanding the continuing disruption from the pandemic and the impact from the Polish small format tax. Whilst there remains some uncertainty in the short-term outlook, we remain confident in the future prospects for Stock Spirits, as illustrated both by the investments that we are making in our brands and infrastructure, and by the continuation of our progressive dividend policy.”

Analyst presentation

Management will be hosting a presentation via an audio webcast and conference call which will be hosted by CEO Miroslaw Stachowicz and CFO Paul Bal at 9:00am (BST) on Wednesday 12 May 2021. Dial-in details are below. Please dial-in at least 15 minutes prior in order to ensure a timely start to the briefing.

Audio webcast:

Conference call:


Phone Number



+44 (0) 2071 928338




Please note that questions will only be taken over the conference call and not the audio webcast.

A replay of the audio webcast will be available shortly afterwards on the same link as above.

For further information:

Stock Spirits Group                                +44 (0) 1628 648 500

Paul Bal

Powerscourt                                            +44 (0) 207 250 1446

Rob Greening                                 
Lisa Kavanagh
Bethany Johannsen


A copy of this interim results announcement ("announcement") has been posted on

About Stock Spirits Group

Stock Spirits is one of the leading branded spirits and liqueurs businesses in Central and Eastern Europe and Italy, and offers a portfolio of products that are rooted in local and regional heritage. With businesses in Poland, the Czech Republic, Slovakia, Italy, Croatia and Bosnia & Herzegovina, Stock Spirits also exports to more than 50 other countries worldwide. Global sales volumes currently total over 125 million litres per year. 

Stock Spirits has production facilities in Poland, the Czech Republic, Germany and Italy. Its portfolio includes well-established “millionaire” (selling in excess of one million 9 litre equivalent cases per annum) brands including Żołᶏdkowa, Lubelska, Božkov and Stock Prestige, local leaders such as Stock 84 brandy, Fernet Stock bitters, Keglevich and Limoncè, as well as more recent innovations including Amundsen Expedition vodka and Božkov Republica rum.

Stock Spirits is listed on the main market of the London Stock Exchange. For the year ended 30 September 2020 it delivered total revenue of €341.0m and operating profit before exceptional items of €57.8m.

For further information, please visit


This announcement may contain statements which are not based on current or historical fact and which are forward looking in nature. These forward looking statements may reflect knowledge and information available at the date of preparation of this announcement and the Company undertakes no obligation to update these forward looking statements. Such forward looking statements are subject to known and unknown risks and uncertainties facing the Group including, without limitation, those risks described in this announcement, and other unknown future events and circumstances which can cause results and developments to differ materially from those anticipated. Nothing in this announcement should be construed as a profit forecast.

Basis of Preparation

The financial information contained in these interim results does not constitute statutory accounts of Stock Spirits Group PLC within the meaning of Section 434 of the Companies Act 2006. Statutory accounts for Stock Spirits Group PLC for the 12 months ended 30 September 2020 were delivered to the Registrar of Companies. The auditors have reported on the accounts. Their report was: (i) unqualified; (ii) did not include a reference to any matters to which the auditor drew attention by way of emphasis without qualifying their report; and (iii) did not constitute a statement under Section 498(2) or (3) of the Companies Act 2006.



Despite a hugely challenging backdrop, we have delivered another resilient performance during the first half of the year. Our locally focused business model operated without interruption. For almost the entire period, the on-trade channel in all of our main markets was either closed completely or heavily restricted by COVID-19 lockdown regulations. Over the period, that channel represented around 6% of Group revenue, down from around 15% before the pandemic. 

Notwithstanding these difficult conditions and uncertainties, and strong prior year comparatives, in constant currency terms our revenue in the period of €183.4m was up by +0.3% versus the prior period, and Adjusted EBITDA of €44.5m was +1.7% ahead. Importantly, our brands gained market share almost wholly across the board in their categories in our core markets of Poland, Czech and Italy.

In Poland, our biggest market (57% of Group revenue) and the least exposed to the on-trade, we continued to experience positive momentum. Market share, volume, constant currency revenue and Adjusted EBITDA all grew, fuelled by a succession of innovative new products, especially in flavoured vodka. The retail pricing environment remained favourable after the 2020 excise increase and the new tax on small format bottles, introduced in January 2021, was fully passed on to the consumers.

The lockdown had a marked impact on our Czech business (25% of Group revenue) as the on-trade channel was traditionally around one-third of both our revenues and that of the total market. Competition in the Czech market intensified in the imported rums sub-category, whilst at the same time easing in herbal bitters. We are responding by consistently building our brand-equity in the rum category, whilst constantly driving growth and profitability in the remaining spirit categories.

It is pleasing to see our Italian unit (10% of Group revenue) respond well to its increased scale despite also being very exposed to the negative dynamics of the on-trade channel (pre-pandemic c.53% of total market sales in that country). Growth was primarily driven by the Distillerie Franciacorta business which we acquired in 2019 and has now been successfully integrated, and the Beam Suntory portfolio, whose distribution we took on in April 2020.   

Our ‘Other’ markets (including Slovakia, Croatia and Bosnia & Herzegovina together with our export operations, known as ‘International’) delivered a stable performance overall, as challenges in markets exposed to the on-trade were offset by the improved performance of our Slovakian unit.

Working under lockdown conditions is slowing progress with initiatives that require more collaborative, cross-border effort. As previously reported, M&A progress has been particularly impacted, and we look forward to picking up momentum in this area as vaccination programmes across continental Europe continue to be rolled out.

During the period we have also started developing an updated strategy for the next three years. We believe that we delivered strongly against our current strategic priorities, and as a result we do not anticipate a significant departure from the areas that are currently under focus. The updated strategy, together with our revised long-term objectives, will be announced with our full-year results at the end of this year. As part of this strategic update, we will also further articulate our ambitious People, Planet, Processes ESG strategy, covering our relationship with the environment, our contributions to the communities in which we operate, and the framework of disciplines and processes that govern our business.      

We are today announcing an interim dividend of 2.98 € cents per share, representing an increase of 7.6% versus last year’s interim dividend of 2.77 € cents. Given our robust balance sheet, strong cash generation and resilient performance despite exceptionally challenging and uncertain trading conditions, we are pleased to continue with a progressive dividend policy for our shareholders.


M&A remains a strategic focus and whilst the COVID-19 pandemic has curtailed any M&A activity over the last 12 months, as conditions improve we will endeavour to seek out larger, more strategic opportunities to deliver growth and shareholder value for the future.

Market performance


Poland (57% of Group revenue) delivered a strong performance across all of the key spirits categories, which is a clear illustration of the continuing momentum in our largest market.

Revenue decreased slightly on a reported basis by 0.5% to €104.3 million; and on a constant currency basis revenue was up €4.3 million or 4.3% (H1 2020: €100.0 million). Reported Adjusted EBITDA was €29.1 million (H1 2020: €28.5 million). On a constant currency basis Adjusted EBITDA increased by €1.9 million, with an increase in margin from 27.2% to 27.9% reflecting improved margin mix and reduced investment during the pandemic.

Total off-trade spirits value grew by +9.5%. Stock delivered growth in the three biggest spirits categories – vodka, whisky and brandy. Vodka, the largest spirits category in Poland, performed positively despite the COVID-19 challenges, achieving value growth of +6.8%. The key drivers were: strong growth from the total flavoured vodka segment’s value (+8.2%), which commands higher average selling prices per litre than total clear vodka; and premiumisation, which continued despite COVID-19, leading to total premium vodka growth of +8.6% as consumers traded up to higher quality products at higher average price points.

It remains too early to assess the full impact of the small format tax, introduced in January 2021, on the performance of the overall vodka category. Initial indications are that, whilst overall consumption has declined slightly in the period between January and March, it is also changing format mix i.e. decreasing the proportion of purchases in small formats and growing the share of larger formats, in part due to consumers decanting at home. The roll-out of our new product development (NPD) programme in the small format segment is progressing as planned, including the introduction of the 25% ABV product offer in a 90ml pack; the 45% ABV product in a 40ml pot-shot and the implementation of a 350ml pack format.

Stock Spirits outperformed the total vodka category, growing value by +10.6% and increasing its value share from 29.7% to 30.7% on an MAT basis, a five year high. Our category-leading growth has been achieved through continued successful innovation in our flavoured range, coupled with the success of our premiumisation initiatives in clear vodka.

Whisky, the second largest spirits category in Poland, achieved double digit volume and value growth. Stock Spirits grew the absolute value of its leading agency distribution brand in Poland, Jim Beam, by +14.8%.

In brandy, the third largest spirits category in Poland, Stock Spirits maintained category leadership and grew Stock 84 value by +14.6%.

The on-trade has traditionally been estimated to account for around 10% of the market in Poland. Our business is under-represented in this channel, with only around 1% of Stock’s Polish revenue coming from the on-trade during this period (versus 3% prior to the pandemic).

Work on a new distillery at our Lublin facility continues and is expected to deliver the projected returns, despite minor COVID-related delays and additional investments in sustainable technologies.

Czech Republic

The environment has been highly challenging in the Czech Republic (25% of Group revenue) due to its sizeable on-trade channel being in lockdown for a substantial period, and competitor price discounting in the imported rum category. However, Stock continues to lead the spirits market whilst investing in brand equity growth and margin enhancement for the long term.

Reported revenue declined by 16.6% to €45.2 million (H1 2020: €54.2 million). On a constant currency basis, the decline was 13.6%. Reported EBITDA was €15.0 million (H1 2020: €19.8 million). On an underlying constant currency basis EBITDA decreased by €4.1 million, delivering a margin of 33.2% (H1 2020: 36.4%).

Total off-trade spirits value grew by +15.3% driven in part by COVID-19 increasing at-home consumption, but also because consumers continued to trade up to higher quality and higher price-point products.

Three of the four biggest spirits categories: rum, vodka and whisky remain in MAT value growth, more than compensating for a flat performance in herbal bitters.

As market leader, Stock Spirits chose to invest in brand equity-building and delivered growth in total spirits value (+16.2%), in line with the total spirits market, maintaining total spirits value share of 33.5%. Our Božkov brands (in rum and vodka) are an example of the benefits of investing in brand equity building, having recently delivered four gold and three silver medals at a series of prestigious international competitions.

Very positive value share growth was achieved in the herbal bitters category with Fernet Stock through the re-launched range and revised price architecture, growing from 24.6% to 27.6%. Growth was also achieved on Božkov and Pražská vodkas and on our agency distribution whisky portfolio. In rum, the largest spirits category in the Czech Republic, share gains from Božkov Tuzemsky and premium agency distribution brand Legendario (from the Bartida acquisition) were offset by losses on Božkov Republica, which came under pressure from local competitor copycat brands, leading to a decline in Stock’s overall rum category value share from 65.7% to 64.0%.

The on-trade has traditionally been estimated to account for some 32% of the Czech market5. It constituted some 8% of our revenue in the period, whereas it represented around 30% of our revenue prior to the pandemic. Throughout the lockdown we have continued to invest in the systems and training of our on-trade team and are very well positioned to benefit from the re-opening of this channel as lockdown eases.

5 Management estimate


Italy accounts for 10% of the Group's revenue. Revenue increased by +26.3%, to €18.6 million (H1 2020: €14.8 million). Adjusted EBITDA in H1 was €2.1 million (H1 2020: €0.8 million).

Whilst Stock Spirits has a relatively small share of total spirits, with a 6.8% value share in the modern off-trade channel on which we focus, we hold leading positions in several key categories. These include number one brands in clear vodka, vodka-based liqueurs and limoncello, and number two in brandy. In addition, following the 2019 acquisition of Distillerie Franciacorta, Stock is number one in off-trade grappa.

Our Italian range achieved volume and value growth in the modern off-trade. Our range’s presence in the categories most heavily impacted by COVID-19 has contributed to Stock Italia delivering slower growth than the total spirits market, but we outperformed the market and grew share in all of our core categories. This was particularly the case in grappa, where Stock achieved value growth of +15.9%, significantly higher than the total grappa category growth (+9.9%).

The integration of the Distillerie Franciacorta acquisition, with its outstanding heritage and brands, has been completed. Salesforce synergies in both the on and off-trade have resulted in distribution expansion of both portfolios. Plans remain in place for the construction of a new production facility over the coming years.

The on-trade has traditionally been estimated to account for around 53%6 of the Italian market. It constituted around 22% of our revenue during the period, versus around 40% prior to the pandemic. We reorganised our on-trade salesforce during the pandemic and are well positioned to benefit from the re-opening of this channel.

Other markets

‘Other markets’ includes Slovakia, Croatia, Bosnia, as well as other export activities together known as International. Revenue was €15.2 million (H1 2020: €15.8 million) and Adjusted EBITDA was €2.8 million (H1 2020: €2.0 million).

In Slovakia, total spirits market value grew by +13.3%, and Stock continues to premiumise its range to grow value and profitability in what is a highly competitive market.

Stock Slovensko maintained its position as the second biggest spirits company in the off-trade, but its market share declined marginally to 10.6% as a result of growth in economy brands and private label. The management team of our Slovakian business has been combined with our Czech operations. This allowed us to better leverage the resulting scale of the broadly similar brand portfolios in both countries, leading to significantly improved profitability.

In Croatia we reinforced our market leading position in imported brandy, and grew value share from 13.3% to 13.5%.

All distribution brands have performed well, including the Beam Suntory brands, Beluga, The Dubliner Irish whiskey and the more recent addition of the Fentimans tonics range. As previously announced, and building on our existing arrangements, from March we commenced distribution of Diageo’s full portfolio of premium and ‘Reserve’ brands in the Czech Republic.

In Germany our distributor has delivered significant growth by gaining increased listings in the retail segment for our Polish brands. A new brand ambassador for our Italian portfolio has been appointed in Germany to help drive similar growth.

Sources for all market data as referenced above: all data quoted is MAT to end March 2021, from Nielsen for Poland, Czech Republic, Slovakia and Croatia, and from IRI and IWSR for Italy.

Financial performance

Volumes for the period were up 2.0%, primarily due to the continued strong performance in Poland.

Reported revenue was down 3.3% to €183.4 million (H1 2020: €189.6 million) due to the impact from adverse foreign currency movements (-3.6%), as both the Polish Zloty and the Czech Koruna weakened against the Euro. Revenue at constant currency increased +0.3% driven by the increase in volume (+2.0%) and slight mix improvement (+0.1%), but significantly offset by lower effective pricing (-1.9%), mainly in the Czech Republic.

Revenue per litre fell 5.0% to €2.46 (H1 2020: €2.59) influenced by a number of factors: primarily adverse foreign currency movements, but also the mix impact of COVID-driven restrictions in the on-trade in our Czech, Italian and International markets, increased competition in rum in the Czech Republic, and more latterly, the impact of the small format tax in Poland.

Cost of goods sold per litre decreased 3.6% to €1.34 (H1 2020: €1.39), again mainly due to the impact from foreign currency (-4.3%), but offset by an increase in third-party brand costs and mix. These factors contributed to the gross profit margin diluting 90bps.

Selling expenses decreased 4.6% from a combination of lower third party sales agent costs and a decrease in investment in the on-trade channel, both being a consequence of the on-trade closures. Other operating costs decreased 11.1% mainly due to lower share-scheme costs and an insurance claim refund in respect of our Baltic distillery.

Operating profit for the period was €37.9 million, an increase of 51.8% on H1 2020 (€25.0 million). Adjusted EBITDA, at €44.5 million (H1 2020: €45.6 million) was 2.4% lower, due to the impact from foreign currency movements (-4.1%). However, Adjusted EBITDA margin improved 20bps to 24.3%. Consequently, Adjusted EBITDA at constant currency increased by +1.7%.

Net debt increased by €15.6 million to €38.3 million (30 September 2020: €22.7 million) largely due to the payment of the full-year 2020 final and special dividends (totalling €35.9 million), net capital expenditure (€5.0 million), and the purchase of own shares to meet share-scheme requirements  (€3.8 million), partially offset by strong cash flow from operating activities of €31.3 million. As a result, leverage has increased from 0.32x (as at 30 September 2020) to 0.55x, reflecting the increased level of net debt.

Our financing facility covenants are: Net Debt/EBITDA 3.5x maximum and Interest Cover 4.0x minimum. We currently operate, and expect to remain, comfortably within these levels, and retain significant unused bank facilities. We have renewed our €200 million (with a €100 million ‘accordion’) financing facilities which now run to May 2024 with the possibility to extend to May 2026 and no material changes in either pricing or flexibility.

Net finance costs declined to €1.4 million (H1 2020: €2.2 million) due to a decrease in bank facility-drawings during the period and a reduction in interest rates.

As set out in the principal risks and uncertainties and in note 9 of the interim condensed consolidated financial statements, we continued with the appeal process against the €4.3 million assessment issued by the Polish tax authorities in respect of our 2013 Corporate Income Tax return and historical tax positions. There have been no significant developments during the period.

In December 2020, we received a decision from the Polish tax authorities in respect of the 2015 tax audit which focused on intra-group funding and withholding tax. An assessment amounting to €4.3 million, representing withholding tax, interest and penalties on inter-company interest payments, was received and paid in full. Following an unsuccessful administrative appeal to the tax authority issuing the assessment, an appeal to the District Administrative Court was lodged in March 2021. We believe the basis of the assessment to be incorrect and have therefore recognised a receivable in respect of the amount paid.

In March 2021, the Czech Republic District Administrative Court issued an unfavourable judgement in respect of our appeal against the 2011 Corporate Income Tax assessment disallowing certain intra-group management recharges. As the judgement contradicts a substantial body of evidence submitted by us, an appeal was submitted on 15 March 2021 to the Supreme Administrative Court. Tax and penalties relating to the assessment were paid in May 2018.

Adjusted basic earnings per share was 14.11 € cents for the period, a decline of 1.9% on H1 2020 of 14.38 € cents per share.

The Board of Directors has approved an interim dividend payment of 2.98 € cents per share, an increase of 7.6% on the prior year interim dividend. This is consistent with our aim of providing progressive dividends, whilst maintaining our ability to build scale through potential future M&A. Our robust balance sheet and continued strong cash flow generation provide us with the capacity for further M&A should suitable opportunities arise. However, as we have said previously, if no meaningful M&A activity materialises then we will as a matter of course consider returning cash to investors via additional shareholder distributions.

The dividend will be paid on 18 June 2021, with a record date of 28 May 2021 (shareholders on the register at the close of business on 28 May 2021). The Euro:Sterling exchange rate will be fixed on the record date.


We believe we have successfully weathered the difficult conditions of the past six months and we are well positioned to benefit from the post-pandemic recovery.

The negative impact of COVID-19 on the on-trade part of our business will continue until the pandemic is brought under control and there is a return to a more normal pattern of consumer behaviour. Given the continued progress being made in the roll-out of the vaccine programmes, we are confident that this reversion will happen in due course, and believe that it is likely to be preceded by an initial period of higher demand from consumers, especially if there is a tendency to travel less internationally.

There is the potential for more regulatory changes as governments tackle the economic consequences of their pandemic responses. Whilst the introduction of the anticipated new small format tax in Poland from 1 January 2021 has not had a material impact on our results during this period due to pre-selling, we expect that it will inevitably negatively affect the appeal of smaller format products in the market. Our plans to address this are currently being implemented and, based on our previous experience in meeting such challenges, we expect to be able to substantially mitigate the impact.

While there is still ongoing uncertainty as a result of COVID-19 and future regulatory developments, our model remains resilient. We remain confident in the future prospects for Stock Spirits, as illustrated both by the investments that we are making in our brands and infrastructure, and by the continuation of our progressive dividend policy.

Going concern

After making enquiries, the Directors have a reasonable expectation that the Company and its subsidiaries have adequate resources to continue in operational existence for at least the next twelve months. For this reason, they continue to adopt the going concern basis in preparing the consolidated financial information of the Group.

Principal risks and uncertainties

Stock Spirits Group believes the following to be the principal risks facing its business. Risks are identified and assessed through a combined bottom-up and top-down approach. If any of these risks occur, Stock Spirits’ business, financial condition and performance might suffer and the trading price and/or liquidity of the shares may decline. Not all of these risks are within our control and this list cannot be considered to be exhaustive, as other risks and uncertainties may emerge in a changing business environment.

The timetable at which the COVID-19 vaccination programmes across our key markets enable lockdowns and other restrictions to be lifted remain uncertain. It is also not yet possible to determine the longer-term macro-economic impact of the increased government spending and loss of tax revenue in our key countries. At this point in time, we are assuming that when restrictions are lifted, our markets will return largely to normal. However, there may be some longer lasting changes within the trade channels e.g. some bars, restaurants and other outlets may decide not to re-open when the pandemic ends. International travel may continue to be subdued, impacting economies that depend on a high level of tourism such as Italy, even after allowing for a compensating increase in domestic tourism. Online purchasing could continue to increase for all categories, including alcohol. There may be other longer lasting changes in consumer behaviours, but it is not yet clear whether that might entail a reduction in social gatherings, or an increase. Taking all these uncertain factors into account, we are currently assuming that underlying consumer demand and trends will not be significantly altered post COVID-19 in a way which would materially impact our Group as a whole. This is broadly the position we have observed over the preceding 12 months since COVID-19 became widespread across our markets, during which time our businesses demonstrated their resilience, although firm conclusions about the future cannot yet be drawn. Based on that, the Board considers the principal risks and uncertainties for the Group are:

  • Economic & political change - Results are affected by overall economic conditions and consumer confidence in key geographic markets in Central and Eastern Europe markets where economic and regulatory uncertainty is considered to be higher than other European countries.
  • Taxes - Increases in taxes, particularly excise duty rates and VAT, could adversely affect the demand for the Group's products. Tax increases are likely to be considered by many governments to help pay the costs incurred in handling the COVID-19 outbreak. Demand for the Group’s products is particularly sensitive to fluctuations in excise taxes, since excise taxes generally constitute the largest component of the sales price of spirits. New taxes such as the small format tax in Poland present a similar risk. The Group may also be exposed to tax liabilities resulting from tax audits. Changes in tax laws and related interpretations and increased enforcement actions and penalties may increase the cost of doing business. In addition, certain tax positions taken by the Group are based on industry practice and external tax advice and/or involve a significant degree of judgement.
  • Laws & regulations – The Group is subject to extensive laws and regulations limiting advertising, promotions and access to its products, as well as laws and regulations relating to its operations, such as anti-trust, anti-bribery, data protection, late payment of creditors, health and safety and environmental laws, and there is increasing enforcement of such laws. These regulations and any changes to them could limit the Group’s business activities or increase costs.
  • Marketplace & Competition - The Group operates in highly competitive markets that may result in pressure on prices and loss of market share.
  • Strategic transactions - Key objectives of the Group are: (i) the development of new products and variants; (ii) expansion through the acquisition of additional businesses; and (iii) distribution agreements with world-class brand partners. Unsuccessful launches, or failure by the Group to fulfil its expansion plans or integrate completed acquisitions, or to maintain and develop its third party brand relationships, could have a material adverse effect on the Group's growth potential and performance.
  • Disruption to Operations and Environment – our operations or systems could be disrupted by physical events or cyber-attacks. From an environment perspective, the Group faces two main types of risk: transition risks such as taxes on carbon and plastic; and physical risks such as extreme weather conditions and climate change causing acute and/or chronic impacts on supplies of key raw materials such as grains.

Further detail on the principal risks and uncertainties affecting the business activities of the Group are set out on pages 52-59 in the Stock Spirits Group 2020 Annual Report, a copy of which is available on the Company's website at Subject as stated above regarding COVID-19 uncertainty, in the view of the Board there is no material change in these risks in respect of the remaining six months of the year.

Responsibility statement of the Directors in respect of the half-yearly financial report

We confirm to the best of our knowledge:

The condensed set of financial statements has been prepared in accordance with IAS 34 Interim Financial Reporting in conformity with the requirements of the Companies Act 2006.

The interim management report includes a fair review of the information required by:

  1. DTR 4.2 7R of the Disclosure Guidance and Transparency Rules, being an indication of important events that have occurred during the first six months of the financial year and their impact on the condensed set of financial statements; and a description of the principal risks and uncertainties for the remaining six months of the year; and
  2. DTR 4.2 8R of the Disclosure Guidance and Transparency Rules, being related party transactions that have taken place in the first six months of the current financial year and that have materially affected the financial position or performance of the entity during that period; and any changes in the related party transactions described in the last annual report that could do so.

Board of Directors

The Board of Directors as at 12 May 2021 is as follows:

David Maloney, Non-Executive Chairman
Mirek Stachowicz, Chief Executive Officer
Paul Bal, Chief Financial Officer
John Nicolson, Senior Independent Non-Executive Director
Kate Allum, Independent Non-Executive Director
Diego Bevilacqua, Independent Non-Executive Director
Tomasz Blawat, Independent Non-Executive Director
Mike Butterworth, Independent Non-Executive Director

For and on behalf of the Board of Directors

Mirek Stachowicz, Chief Executive Officer
David Maloney, Chairman

12 May 2021


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