Conviviality Shares Fall As Earnings Set To Be Below Expectations

LONDON (Alliance News) - Shares fell in Conviviality PLC on Thursday as it said it expects earnings for its current year to be below market expectations.

Shares in the UK alcohol distributor was down 43% at 172.20 pence per share on Thursday.

Conviviality said it expects adjusted earnings before interest, taxes, depreciation and amortization for the current year to be about 20% below market expectations, resulting from a material error in the financial forecasts of the Conviviality Direct business, impacting Ebitda by GBP5.2 million.

For the financial year ended April 30, Conviviality reported adjusted Ebitda of GBP60.9 million.

The company said sales and orders have increased, compared with the year before, but this was more than offset by soften margins in January and February. The margin intends to remain weak until the end of current financial year, it said.

Last year, Conviviality reported sales of GBP1.0 billion while gross margin stood at around 13%.

The previous guidance for net debt of around GBP150 million for the period ending April 29 remained unchanged, Conviviality said.