Zwack Margins Narrow
After-tax profit of Zwack Unicum, Hungary's biggest spirits maker, rose 8% year-to-year HUF 3.8 billion in Q1-Q3 of its business year started April 1, an earnings report shows, state news wire MTI reports.
Zwack's net revenue climbed 18% to HUF 17.4 bln. Material costs jumped 32% to HUF 7.2 bln, reducing gross margin by 4 percentage points to 59%.
The company noted that it announced a 7% average price rise in June to counter a 6% bigger tax burden as the excise tax rose and spirits were exempted from the public health product tax (Neta).
Zwack acknowledged a decline in third-quarter profit, but said earnings were still "significantly higher" than estimated. Zwack continues to forecast a "significant fall" in consumption in the fourth quarter, but expects full-year profits to be "roughly similar" to the previous business year because of the strong Q3.
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