CEDC ups profits, again
alcoholic beverages in Poland, is predicting another strong
financial performance by unveiling an increase in its preliminary
second quarter profits. The figures are said to have been further
boosted by Poland's accession to the European Union on 1 May.
CEDC said it recorded quarterly profits of $4.57 million (€3.78m), up 32 per cent on corresponding quarter in 2003 when profits hit $3.46 million. This figure came in against un-audited net sales of $133.0 million, compared to $105.1 million in the corresponding quarter in 2003.
Because of the results the company also said that it was standing by its previously announced full year 2004 guidance that put net sales in the range of $543 to $553 million. The Company said it would file full second quarter 2004 financial results on August 9th.
Poland's alcoholic beverages market was, up until recently, largely controlled by the country's government. However, since the privatisation of its state-owned 'Polmos' companies, the marketing has become increasingly diversified and competitive. CEDC, whose initial operations in the country had concentrated on the domestic alcohol market, has found itself in a strong position to benefit from these changes.
Laterly the company has also managed to use Poland's EU membership to its full advantage, too, by tapping into the spiritis market. In most cases accession has meant that duties on imported spirits have been significantly reduced, enabling retailers to pass on the savings to customers who have in turn increase their expenditure. In a recently conducted domestic poll, most Polish consumers said that they had experienced a significant rise in all food and beverage items since accession, with the exception of some alcoholic beverages, which were deemed to have come down in price.
All this has meant that CEDC has been able to benefit from the increasing liberalisation of the domestic alcohol market in Poland in recent years and has now been given a further boost by the country's accession to Europe - moves that have been carefully planned by astute management team.
In turn, the current market conditions lead many analysts to believe that CEDC is in a strong position to further capitalise on its position in the market. Not surprisingly many investment analysts are tipping the company as a good buy for share investors.
CEDC is one of the leading importers of beers, wines and spirits, as well as the largest distributor of domestic vodka on a nationwide basis in Poland. The Company operates ten distribution centres and 70 satellite branches throughout Poland.
