Stock Spirits prepares for Czech Republic tax hike
Central and eastern European drinks group Stock Spirits is taking “necessary action” as the Czech Republic prepares to add a 13% excise tax on spirits from January 2020.
The 13% increase in excise tax on spirits in the Czech Republic is expected to be ratified later this month, and come into effect on 1 January next year.
Similar changes were floated in Poland and Italy, which Stock Spirits referred to in its half-year results in May, but there have since been no further suggestions of tax hikes in either country.
Stock Spirits said about the proposed tax increase in its pre-closing trading update and notice of results for the year ending 30 September 2019: “We are implementing a range of necessary actions ahead of this change.”
In its pre-closing trading update, the group also said overall trading for the year “was in line with our expectations”.
Poland and the Czech Republic represent approximately three-quarters of Stock Spirits’ revenue. Both regions continued to show growth in volume and value terms, according to Nielsen MAT August 2019.
The company noted its “strong performance” in the Czech Republic was driven by strategic initiatives, including premiumisation, new product development and the addition of Beam-Suntory distribution brands.
In Poland, “business continued to perform well” despite competitive trading conditions, with vodka “outperforming total vodka growth” in clear and flavoured sub-categories, and increasing the firm’s volume and value share.
Stock Spirits said it was on track with the integration of Distillerie Franciacorta, which it acquired in June this year.
The group has also been focusing on the premium on-trade market in the Czech Republic following the acquisition of the Bartida businesses, which was completed in May.
The full-year results will be announced on 4 December 2019.