11 Dec CEO of South African drinks maker Distell promises stronger returns in 2021
The chief executive of South African wine and spirits company Distell has promised the company will deliver higher investment returns next year after a hugely disappointing performance in a COVID-19 ravaged 2020.
A government-ordered alcohol ban to prevent the spread of the virus in South Africa damaged Distell’s sales and earnings throughout the lockdown period. The JSE-listed firm’s shares have subsequently dropped by more than a quarter.
The world’s second largest cider maker had already irked some shareholders with years of significant investment outlay, but boss Richard Rushton told Reuters that efforts to build up Distell’s continental operations are now starting to bear fruit.
The chief said the number of outlets selling the company’s products on the continent outside South Africa is up from 12,000 a year ago and on course to hit 32,000 by year-end, giving Distell greater growth prospects beyond its home market.
Rushton was appointed to the board at Distell in 2013 after around 15 years at beer giant SABMiller. He has long harboured ambitions to replicate the success he enjoyed at his former company, which was labelled the ‘African drinks champion’ during his time as the helm.
Distell has spent R3.87 billion on expanding its capacity, including manufacturing and distribution, since 2015 – a spending phase the company says is now largely over.
“We’re a long-term investment business…So investors have to come along for the ride,” said Rushton.