Profit of Purcari Wineries drops in Q1 despite higher sales
<p>CEE’s leading wine producer with operations in Moldova and Romania, Purcari Wineries - BVB: WINE, announced the group’s revenue grew by 11% in Q1 this year, reaching RON 81.6 million.&nbsp;</p>

<p>EBITDA rose by 9% y/y to RON 23.1 million in Q1, marking a margin of 28%.</p>

<p>The company’s net profit contracted by 15% y/y to RON 10.8 million (EUR 2.2 million) in Q1, resulting in a 13% net profit margin, down from 17% in the same period last year. The key element leading to the drop in the bottom line was the financial result. The results from operations increased by 9% y/y to RON 35.7 million.</p>

<p>The company’s market capitalisation was RON 590 million (EUR 118 million) on May 14, before the release of Q1 financials, after its shares rose by 53.7% y/y.&nbsp;</p>

<p>The company is paying this year a dividend that, at the current price of the shares, accounts for a 3.7% yield.</p>

<p>“We have had a good start of the year [...]. As inflationary pressures ease and the effects of the strong harvest in 2023 trickle in, we are seeing more headroom for improving margins,” commented Victor Bostan, CEO of Purcari Wineries.</p>

<p>The group anticipates the discontinuation of the activity of the EcoSmart Union, the waste recycling business, following the development of the national Guarantee Return System. Ecosmart accounted for circa 8% of revenues and 4% of EBITDA and Net Income in 2023.</p>

<p>The company revised its full-year forecast to revenue growth of +12-15% - lowered from +16-20%, reflecting Ecosmart adjustment. The revenue growth for the winery activity was maintained at +20-24%, while the projection for the EBITDA margin was also kept at 26-28%. The net income margin is seen as steady at 14-16%.</p>

<p><em>iulian@romania-insider.com</em></p>

<p><em>(Photo source: Vlad Ispas/Dreamstime.com)</em></p>