(Alliance News) - Distil PLC on Thursday said it had faced "a tough quarter of trading" at the end of its financial year, but the company still expects to report annual growth upon the publication of its results in June.
The London-based premium drink brand owner said it experienced a weaker fourth quarter than expected for the financial year ended March 31.
Fourth quarter revenue decreased 23% year-on-year to GBP344,000 from GBP448,000, with volumes in the quarter dropping by 47% compared to a year prior.
However, Distil said that full-year cumulative revenue increased 17% to GBP1.6 million from GBP1.3 million a year before. Full year cumulative volumes also increased 8.0%.
Gross profit for the final quarter was down 19% to GBP205,000 from GBP252,000, but full year cumulative gross profit increased 11% to GBP759,000 from GBP683,000.
In its statement, Distil said that consumers are "facing continued spending pressures" and "cutting back on consumption or turning to categories that are perceived to be less expensive, such as beer and cider."
The fourth quarter is also "historically our quietest trading period", Distil added.
Strong third quarter sales also resulted in "a higher than usual stock holding" for some customers, prompting lower sales for the following quarter.
The company has reported 131% year-on-year growth for the quarter in export markets, with full year tracking increasing by 26% year-on-year.
Distil increased its advertising and promotional spending by 78% in its fourth quarter to GBP130,000 from GBP73,000 a year prior. The increase was related to in-market activation with export customers, new product development and investment activity to improve results for financial 2024.
The full-year cumulative advertising and promotional spend for financial 2023 decreased 15% to GBP496,000 from GBP582,000.
Distil partnered with Global Brands Ltd this quarter to service its UK grocery, cash & carry, and convenience customers, working to accelerate brand growth.
Executive Chair Don Goulding said: "The company has faced a tough quarter of trading as the wider market continues to operate within challenging conditions, however the full year results remain positive, showing double-digit growth on the previous year."
Distil is scheduled to release its results for financial 2023 in June.
Distil shares fell 5.8% to 0.59 pence each in London on Thursday morning.
By Emily Parsons, Alliance News reporter
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Distil (DIS)