Original Story Published by: Food Business Africa
SOUTH AFRICA – Liquor giant Distell, controlled by investment group Remgro, is still pursuing an ambitious target of doubling revenue and profit in five years as it targets the African markets.
At the release of interim results, Distell CEO Richard Rushton said much of the growth impetus at top and bottom line would come from endeavours in African markets.
Rushton was particularly pleased with the showing of Best Global Brands (BGB) which operates in Angola and Nigeria and posted sales volume and profits that were above expectations.
Distell last year acquired a 26% stake in BGB for US$54.6m and has an option to acquire the remaining 74% interest.
Distell’s share of BGB’s profits was about US$3.58 million.
Rushton said BGB’s Angolan operations were set to reach 33-million litres at year end and Nigeria another 10-million litres, with expansion plans into Kenya, Zambia and Mozambique on the cards.
Distell financial director Lucas Verwey reckoned that if Distell acquired the remaining tranche of shares in BGB the company had the potential to add as much as US$68.26million to EBITDA (earnings before interest, tax, depreciation and amortisation).
“BGB has significant expansion potential, it offers a platform to build a scale Pan-African business.”
Aside from accelerating the African thrust, Distell also plans to expand into one international market.
Rushton said acquisitions would not be rushed and would be carefully considered.
“We are not wildly chasing a number.
We recently had an opportunity [in an emerging market] that we looked at and decided not to pursue.
There are more opportunities out there; if the right deal comes along we will pursue it.”
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