The Damm Group makes €26.5 million in the first half of the year, 1.1% less than during the same period last year
The Damm Group, manufacturer of the popular Catalan beer brand Estrella, had a turnover of 421 million in the first six months of 2012, a 8.5% increase in relation to the same period last year. The company is not making any predictions for the second half of the year due to the uncertainty over the VAT increase but has stated that sales over the past weeks have “evolved satisfactorily”.
Barcelona (ACN). \u2013 The Damm Group is best known for its beer products including one of the most popular beers in Catalonia, Estrella. The Catalan company made a turnover of over \u20AC421 million in the first half of this year, representing an increase of 8.5% compared with the same period last year. The company\u2019s net profit during this period was \u20AC26.5 million, 1% less than in the first six months of 2011. Damm stated that \u201Cit\u2019s not possible to draw any conclusions\u201D about its future performance from the results of the first half, since they are waiting for the results of the third quarter and there is uncertainty surrounding the effect of the VAT increase from September 1st. Also the increase in consumption during the summer will affect the company\u2019s results. Despite these uncertainties, Damm said that sales in the past weeks have \u201Cevolved satisfactorily\u201D.
Damm explains that the first half was marked by a continual \u201Cweak economic and financial situation\u201D, with negative annual rates of GDP, a growing number of unemployed and much uncertainty about the future of the economy, causing adverse effects on domestic consumption. In the statement, the company said that the effect of the crisis has damaged sales, especially in the bar and restaurant sector where sales are declining, while sales in supermarkets for direct consumption at home are increasing.
The beverage industry is very dependant on the weather and the summer period, meaning that it is not possible to draw conclusions for the rest of the year from the company\u2019s results so far. Moreover, this year there is uncertainty surrounding the effect of the VAT increase from September 1st. However, Damm said that sales so far this summer have \u201Cevolved satisfactorily\u201D.
Damm also highlighted the incorporation of new businesses into the group, after the acquisition of Rodilla Group and Cacaolat (a leading Catalan milkshake brand) which has facilitated the expansion of its product range and put the group in a better position for the coming years. Damm\u2019s acquisition of other companies has increased the number of employees to 3,257 people by the end of the first half, 40% more than last year. Investments made during the first half totalled \u20AC68 million.
In the statement, the Catalan company referred to the increased cost of raw materials and packaging, as well as increased logistical expenditure as a result of rising fuels costs.