CSW.B Corby Spirit and Wine Limited

TORONTO, Nov. 10, 2021 /CNW/ -  Corby Spirit and Wine Limited ("Corby" or the "Company") (TSX: CSW.A) (TSX: CSW.B) today released its first quarter results for the period ended September 30, 2021.

Quarterly Dividend declared of $0.24/share, up +14% on last reported quarter

Good start of the year with solid consumer demand and On-Premise recovery

Q1 financial result, impacted by high comparison basis and supply chain delays, not indicative of full year outlook

Quarterly dividend

Following the strong results achieved in extraordinary circumstances last year, the Corby Board of Directors is pleased to declare a dividend of $0.24 per Voting Class A Common Shares and Non-Voting Class B Common Shares of the Company, an increase of +14% on the last reported quarter, in line with our generous dividend policy and to share the strong results of fiscal 2021. This dividend is payable on December 10, 2021 to shareholders of record as at the close of business on November 26, 2021.  

Representation Agreement and Non-GAAP measurement

Q1 saw the commencement of the new representation agreement with Pernod Ricard announced on September 24, 2020 (the "2021 Agreement") and the payment of the upfront fee, which will be amortized straight line over the duration of the agreement. As a result, financials will be impacted this fiscal year by a one-off amortization variation effect. To help understand underlying business performance, Corby has reported certain Non-GAAP financial measures in this quarter's MD&A which excludes amortization of the representation agreement fee and similarly, amortization of up-front fees paid on the previous representation agreements between the Company and PR (together with the 2021 Agreement, the "Pernod Ricard Representation Agreements", "PR Representation Agreements"). Such measures are described as "Adjusted" (see "Non-GAAP Financial Measures" below).

Business Environment

Corby has seen a positive consumer environment in the first quarter, as the spirits market grew in volume and value with a rebound of the on-premise channel, resilience in the off-premise channel and dynamism in international markets. Corby has enjoyed share gains on some of its owned and represented key brands and categories.

Q1 Results

While we are pleased with positive underlying market performance, Adjusted Revenue was impacted by the cycling of last year's exceptionally high comparison (+13% in Q1 last year) and some supply chain delays due to global volatility. As a result, Adjusted Revenue declined by 9% vs the same period last year (-11% reported Revenue).

Similar adverse comparison basis occurred on our Sales, Marketing and Administration expenses with an increase of +6% (versus -14% in Q1 last year), with marketing activities focusing on media investments on key brands, supporting on-premise rebound.

Q1 Adjusted Net Earnings declined by 27% but notably have grown strongly versus pre-pandemic Q1 fiscal year 2020 with a CAGR of +8.8%. (Reported net earnings declined by 35%, CAGR of +4.3% vs pre pandemic Q1 fiscal year 2020).

Outlook

"I am encouraged by the underlying consumer demand in our first quarter performance and with the rebound of the on-premise channel, this enabled us to increase our brand building efforts. Our reported results are adversely impacted when compared to last year's exceptionally high comparison period and are not indicative of the anticipated full year trend as the phasing of our shipments and our costs normalize over time" noted Nicolas Krantz, CEO.

 "I am particularly pleased that the underlying business fundamentals enabled the Board to maintain dividends in line with our generous policy and to share the success of the strong result we delivered in FY21," Mr. Krantz continued.

For further details, please refer to Corby's Management's Discussion and Analysis and interim condensed consolidated financial statements and accompanying notes for the three-months ended September 30, 2021, prepared in accordance with International Financial Reporting Standards.

NON-GAAP FINANCIAL MEASURES

Non-GAAP financial measures do not have any standardized meaning prescribed by GAAP and are therefore unlikely to be comparable to similar measures presented by other issuers.

Management believes the non-GAAP measures defined above are important supplemental measures of operating performance and highlight trends in the core business that may not otherwise be apparent when relying solely on GAAP financial measures. Management believes that these measures allow for assessment of the Company's operating performance and financial condition on a basis that is more consistent and comparable between reporting periods.

The following table presents a reconciliation of Revenue to Adjusted Revenue, Earnings from Operations to Adjusted Earnings from Operations and Net Earnings to Adjusted Net Earnings to their most directly comparable financial measures for the three months ended September 30, 2021, and 2020:

Adjusted Revenue is equal to revenue for the period adjusted to remove the amortization related to the Pernod Ricard Representation Agreements.

Adjusted Earnings from Operations is equal to earnings from operations before interest and taxes for the period adjusted to remove the amortization related to the Pernod Ricard Representation Agreements.

Adjusted Net Earnings is equal to net earnings for the period adjusted to remove the amortization related to the Pernod Ricard Representation Agreements, net of tax calculated using the effective tax rate. Adjusted earnings per share is computed in the same way as basic earnings per share.

CAGR is the compounded annual growth rate at which a quantity or amount grows over time. 

Please refer to the "Non-GAAP Financial Measures" section of our MD&A for the period ending September 30, 2021 as filed on SEDAR for further information regarding Non-GAAP measures.

FORWARD-LOOKING STATEMENTS

This press release contains forward-looking statements, including statements concerning possible or assumed future results of Corby's operations. Forward-looking statements typically are preceded by, followed by or include the words "believes", "expects", "anticipates", "estimates", "intends", "plans" or similar expressions. These statements are being provided for the purposes of providing information about management's current expectations and plans and allowing investors and others to get a better understanding of our anticipated financial position, results of operations and operating environment. Readers are cautioned that such information may not be appropriate for other purposes and are not guarantees of future performance. Although Corby believes that the forward-looking information in this press release is based on information, assumptions and beliefs which are current, reasonable and complete, this information is necessarily subject to a number of factors, risks and uncertainties that could cause actual results to differ materially from management's expectations and plans as set forth in such forward-looking information. For more information on the risks, uncertainties and assumptions that could cause the Corby's actual results to differ from current expectations, refer to the Risks and Risk Management section of our Management's Discussion and Analysis for the quarter ended September 30, 2021 as well as Corby's other public filings, available at www.sedar.com and at https://corby.ca/en/investors/. Corby does not undertake to update any forward-looking information, whether written or oral, that may be made from time to time by it or on its behalf, to reflect new information, future events or otherwise, except as is required by applicable securities laws. Accordingly, readers should not place undue reliance on forward-looking statements. All financial results are reported in Canadian dollars.

About Corby Spirit and Wine Limited

Corby Spirit and Wine Limited is a leading Canadian manufacturer, marketer and distributor of spirits and imported wines. Corby's portfolio of owned-brands includes some of the most renowned brands in Canada, including J.P. Wiser's®, Lot 40®, and Pike Creek® Canadian whiskies, Lamb's® rum, Polar Ice® vodka and McGuinness® liqueurs, as well as the Ungava® gin, Cabot Trail® maple-based liqueurs and Chic Choc® spiced rum and Foreign Affair® wines. Through its affiliation with Pernod Ricard S.A., a global leader in the spirits and wine industry, Corby also represents leading international brands such as ABSOLUT® vodka, Chivas Regal®, The Glenlivet® and Ballantine's® Scotch whiskies, Jameson® Irish whiskey, Beefeater® gin, Malibu® rum, Kahlúa® liqueur, Mumm® champagne, and Jacob's Creek®, Wyndham Estate®, Stoneleigh®, Campo Viejo®, and Kenwood® wines. Corby is a publicly traded company based in Toronto, Ontario, and is listed on the Toronto Stock Exchange under the trading symbols CSW.A and CSW.B.  For further information, please visit our website or follow us on LinkedIn.

SOURCE Corby Spirit and Wine Limited