Generic selectors
Exact matches only
Search in title
Search in content
Post Type Selectors
Hunters Extreme Bold

Cider rides stellar in Distell’s extensive drinks portfolio

In fact, so successful has Distell been in marketing its Hunters Dry and Savanna brands that the company now ranks as the second-largest cider player in the world. This is a remarkable achievement for a company that first marketed its cider products in the late eighties.

More encouraging is that Distell’s cider growth in 2015 comfortably exceeded the average growth in the global cider category – notching up an 8,7% volume growth versus 4,1% growth.

Distell CEO Richard Rushton – who previously held key global positions for beer giant SABMiller – said the sold growth in cider was driven mainly by the core Hunter’s brand, which launched Hunter’s Extreme Bold in July last year.

He said this natural energy alternative delivered the refreshing taste of apple with a bold kick of guarana. Rushton said the brand doubled in volume over the last 12 months, making it the most popular alcoholic energy drink in South Africa.

Rushton said the pricing architecture in the cider segment was defined, and that growth momentum was achieved through innovation. Both Hunters and Savanna come in different sized formats, and taste variations.

He said, “South Africa cider volume growth accelerated off a much higher base…year-on-year growth has increased due to pricing and packaging architecture and innovation.”

Distell clearly sees the growth momentum continuing, and has confidently invested another R240m in expanding capacity mainly in the cider manufacturing facilities.

Of interest here is that Distell some years ago was the first in SA to invest in freeze concentration technology, from GEA, for its cider concentrate that is bulk shipped from Cape Town to Gauteng.

GEA’s Icecon system involves the removal of pure water in the form of ice crystals at subzero temperatures.  Broadly, this single-stage process consists of one crystallize and one wash column. The crystallizer is a vessel with a cooling jacket. The inner wall of the vessel is scraped. The outer wall is cooled by a circulating refrigerant. Ice production and ice crystal growth take place inside the crystallizer. By creating residence time ice crystals grow, creating an optimal crystal size distribution for efficient separation.

In the wash column, the concentrated liquid is separated efficiently from the ice crystals. A compressed ice crystal bed is washed with melted ice to remove all traces of concentrated liquid. Freeze concentration ensures that all original product characteristics remain in the concentrate.

Other growth points

The bigger picture at Distell is also fascinating – especially in terms of building a liquor business with global attributes. Rushton said the investment programme was designed to enhance its competitiveness as the company sought to double the size of its business by 2020.

Other than cider, Distell owns strong selling brands like Fleur du Cap, Nederburg, 4th Street (now the country’s top wine selling brand) Two Oceans, Graca, Durbanville Hills, Sedgwicks Old Brown, JC le Roux, Amarula, Klipdrift, Viceroy and Richelieu.

In the six months to end December, Distell grew total revenue grew 11,2% to R12,2bn, while operating profits climbed 16,5% to R1,7bn.

Aside from cider’s sprightly showing, Distell also made good gains in African and northern European markets as well as Taiwan – which offset the effects of weak demand from Angola, the UK, Russia, China and Latin America.

Rushton noted, “Consumers responded positively to our product offerings and promotions especially over the festive season.”

But Rushton was cautious about the persistently challenging and volatile trading conditions in many of Distell’s key markets, warning that tougher trading conditions were expected for the second half of the financial year. He said the company would moderate the “sequencing and pacing” of some of its investment plans in some markets.

Still, he remained bullish that Distell’s strategic direction, the versatility and diversity of its portfolio of brands would grow shareholder value over the longer-term.

Source: Cape Business News