SSG's Stock has banner year in Czechia on rising top-quality tipple sales

SSG's Stock has banner year in Czechia on rising top-quality tipple sales
“People have more money and they want to buy quality," commented Stock marketing director Tomas Hejkal as the company's latest results were released.
By Jaroslav Hroch in Prague April 25, 2018

Leading Czech liqueur maker Stock Plzen-Bozkov sold 25mn of litres of alcohol on the domestic market in 2017, up 8% y/y. With rising wages and falling unemployment, Czechs are buying more luxury alcoholic beverages than ever before, the producer said on April 25.

Tuzemak Bozkov "rum" – although Stock is no longer allowed to call it that – remains the best-selling liqueur in Czechia, outpacing the annual rise in overall sales by 8.2% y/y. An even bigger rise was recorded by more luxury version of the rum-like tipple – Bozkov Republica Exclusive.

“People have more money and they want to buy quality. They are also willing to pay more or to experiment with other categories,” Stock marketing director Tomas Hejkal said.

This is confirmed by the case of Plzensky Prazdroj, the jewel in the crown of the Asahi group of Japan, which produces Pilsner Urquell. Premium lager, in general, had a record-breaking year, with exports of more than a million hectolitres.

Prazdroj sold more than 11mn of hectolitres of various beers in Czechia and abroad, an increase 3% y/y. Exports, which increased 6% y/y, and licenced production, up 13% y/y, were the main drivers of the overall production.

Although the domestic market remains the most important one, the latest data show that Czechs are drinking less beer per capita than before (until recently, consuming more per head than nearly any other nation).

In 2017 the volume of produced beer decreased for the first time in seven years, however, in line with a fall in consumption as Czechs turn to wine and other spirits. Exports, on the other hand, have risen continuously for seven years.

Stock is part of distiller and alcohol distributor Stock Spirits Group (SSG), which sells also other brands in Czechia, such as Amundsen and Smirnoff vodka. Stock is the second strongest unit by volume in the SSG group, which is owned by 11 institutional investors, mostly funds.

“Even though Stock is for them the equity investment, they also want Stock to grow and prosper,” Hejkal said. SSG is listed in London and Prague, and its owners hope to change the Czech drinking culture towards more variety, to increase the portfolio and invest in brands and innovation, Hejkal said.

The next bestsellers for Stock in Czechia are bitter herbal liqueurs, such as Fernet Stock, followed by vodka.

SSG total revenues increased 3% y/y in 2017 to €274.6mn. Stock Plzen-Bozkov accounted for approximately 25% of that, itself recording an increase up 8% y/y.