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Zwack Q1 profits slip 3%, but well over target

After-tax profit of Zwack Unicum, Hungary’s most famous spirits maker, inched down about 3% to HUF 740 million in the first quarter of the business year started April 1 from the same period a year earlier.

Revenue fell slightly and cost of materials rose, but profit was still well over the target, the company said in its IFRS report.

Revenue, excluding excise tax, dropped about half a percent to HUF 4.21 billion. At the same time, cost of materials rose about 7% to HUF 1.66 billion as the weaker forint made imports more expensive and the weight of products that cost Zwack more to make grew within the portfolio.

Operating costs, however, fell more than 4% to HUF 1.85 billion as staff cuts reduced payroll costs about the same proportion to HUF 631 million.

Zwack noted that domestic sales were higher than expected because of purchases pushed forward after the announcement of a planned excise tax and VAT rise from July 1. The fall of Q2 sales could be deeper for the same reason, the report said. (MTI – Econews)