Final Results


Chapel Down Group Plc

(`CDG' or `the Company')



Chairman’s statement

I am delighted once again to announce a good set of results for Chapel Down Group plc.

Highlights include:-

  • 34% sales growth to £8.18m (2014: £6.11m)
  • 36% growth in gross profits to £3.02m (2014: £2.22m)
  • £507k* adjusted EBITDA - a 6% increase (2014: £478k*)
  • One of 1000 companies to inspire Britain from the London Stock Exchange
  • Gold medals for our wines in three prestigious global competitions
  • A successful crowdfund to build our new brewery in Ashford, raising £1.71m

2015 was another good year for your Company. We continue to drive our top line without sacrificing margins and we are building strong brands. In our wine business, we enjoyed our second best ever harvest and invested £1.32m in planting 90 acres of new vineyards and in the purchase of further equipment to enhance our viticulture and winemaking. We are growing our supply whilst also investing in marketing, systems and people to stimulate sustainable long term demand. In recognition of the quality of our wines, we won gold medals in three prestigious global competitions - The International Wine Challenge 2015, The Decanter World Wine Awards 2015 and the Sommelier World Wine Awards 2015.

In our beer business, Curious Drinks, we made the decision to raise further funds for its development via a crowdfunding. We were once again delighted by the response raising £1.71m that will be used to build a new brewery site and further develop our brand.

We have continued to invest not only in our equipment, brands and land but also in our people. With the appointment of Mark Harvey as Managing Director of Wines, Frazer Thompson, as CEO, now leads a team of experienced and talented people which makes me ever more confident of an exciting and rewarding future for the Group.

Performance review

We continue to drive our top line, maintain our margins and invest the proceeds into building our brands and business for the long term.

The Group made good progress, with year on year sales up 34%, gross profits up 36% and healthy margins maintained at 36.9% (2014:36.2%). Adjusted EBITDA up 6% at £507,249* (2014: £478,517*) and an adjusted pre-tax profit of £141,405* (2014: £132,736)*. Overall wine sales were up 27% as the stock from the 2013 and 2014 harvests became available for sale and beer and cider sales were up 50%.

Business risks and uncertainties

The uncertainty surrounding the EU referendum has had no real impact on our business to date. We would be affected, like all agriculturally based businesses if we were not able to access EU workers for our viticulture and the expertise in winemaking available in Europe. However, maintaining and developing a strong brand with high quality people is our best defence and we will continue to invest to ensure we are well placed.

There is always a risk of a poor harvest through extreme weather events which we mitigate through maintaining the highest standards of viticulture, choosing the very best sites and utilising the latest proven advances in technology and agriculture. We source from a wide geographic area to minimise micro-climatic variations. The diversification into beer also further protects our ability to continue to grow.

Competition continues to grow in our markets of English wines and craft beers, and we continue to invest in our people, brands and distribution to ensure that the business can thrive.


We have a talented management team now further enhanced with the addition of Mark Harvey in wine and Stewart Gilliland and Rachel Montague-Ebbs as Chairman and Non-Executive Director of Curious Drinks respectively.

We have excellent fast growing brands in two very exciting markets and a strong balance sheet. We have blue chip customers, good export potential and enthusiastic and thirsty consumers. We have more stock of our wines available and more customers wanting our beer and cider.

With the construction of our new brewery on a highly visible site in Ashford, the development of our site in Tenterden and the continuing shift in demand towards high quality drinks made with passion and care, we remain confident that the prospects for the Group are excellent.

John Dunsmore


Chief Executive’s Commentary

“Chapel Down has enjoyed another excellent year of growth. In a highly competitive trading environment your company has continued to invest in the value of its brands, its vineyards and winery and its people as we build a healthy, sustainable and innovative drinks company with an exciting future both at home in the UK and in sophisticated drinks markets abroad. With sales growth of 34% in the Group - sales up 27% on wine and up 50% on beer and cider - we are investing the proceeds to build the business whilst delivering growth in adjusted EBITDA at £507k* (2014: £478k*).

We continue to invest as we operate in two very exciting markets.

English wines, which are now being internationally recognised for their consistent excellence has been the bedrock of our business. Demand is continuing to rise and we are developing a very strong brand to ensure we continue to maximise the potential that is being created through the consumer and trade excitement in cool climate wines. We have also built a long term supply of world class fruit to our modern and efficient winery to ensure that the quality and value we can deliver to the market will be second to none. We planted a further 90 acres of new vineyards in 2015 and we now own and/or manage some 193 acres of vined land and continue to have long term contracts with our high quality group of contracted growers.

“Craft” beers are growing very fast driven by more flavoursome beers that are the antidote to bland international brands that have become overly dominant. There is a vibrancy and excitement to the UK beer market, fuelled by spectacular success in the USA which is spreading internationally. With sales growth of 50% this year, Curious beers are extremely well positioned to benefit from the boom. We have a unique and distinctive proposition rather than just a cool design, amusing name or extreme flavour. In order to make the most of the opportunity, the Company decided to raise further funds to allow the development of an exciting new brewery in the centre of Ashford on a highly visible freehold site adjacent to the international railway station. Once again, we have exceeded our own high expectations via crowd-funding, raising £1.71m and we will be building during 2016 and 2017 to further develop our UK and international business and the brand.

Whilst we have continued to win awards and plaudits for our wines and beers, we have also developed our tourism and hospitality experience at the Tenterden site and whilst we will be extending that expertise to our new brewery, we will be developing the facilities further at Tenterden too.

Our people are the vital difference. In an industry that requires professionalism and customer centric thinking, we remain meticulous about who we hire and how we train.

In the vineyards we continue to improve the quality of the wines we make through the management of our own vineyards and the spread of good practice with our partner vineyards. We apply the most modern viticultural techniques to ensure we get the finest fruit.

In the winery, the fruit is made into the best possible wine through the expertise of a young winemaking team who use the latest technology and equipment. In a highly competitive market, both vineyard and winery teams are constantly challenged to surprise and delight, and that spirit is reflected in the innovative new wines and products that we have created to ensure we remain at the forefront of consumers’ minds. The first ever English “Orange” wine, the first ever English Albarinho, a best in class Blanc de Noir sparkling wine… All of these are terrific achievements for a small team. However, it’s the consistently improving Brut Reserve and Flint Dry, the distinctive and unique Bacchus and the reliable excellence of our other wines, beers and cider that drive us on as new consumers come to the brand every day.

They find us thanks to the constant stream of good news about the company and its brands generated by the industry, enthusiasm, energy and creativity of our commercial team. This is reflected in the feedback we receive from them as they continue to have such positive experiences with the brand - whether that’s in our shop, on the phone, in our restaurant or at an event. I would like to thank them for their continuing support and loyalty.

Finally, we are delighted to have such a supportive and enthusiastic group of shareholders. The energy and excitement that is created by our growing band of shareholders is something the whole team appreciate. I hope you continue to enjoy your investment.”

Frazer Thompson


*Excludes the effect of the FRS 102 Section 26 share option accounting adjustment of £420k (2014: £173k) which is a non-cash item. Refer to note 2 for further information.



Chapel Down Group plc

Frazer Thompson

Richard Woodhouse


Chief Executive

Finance Director


01580 763 033


finnCap Ltd

Geoff Nash/Simon Hicks

Stephen Norcross



Corporate Finance

Corporate Broking


020 7220 0500


    Audited   Audited
12 Mths 12 Mths
31.12.15 31.12.14
£ £
Turnover 8,178,978 6,110,351
Cost of sales (5,161,552) (3,894,918)
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Gross profit 3,017,426 2,215,433
Administrative expenses (2,894,217) (2,126,000)
Share based payment (see note 2) (420,286) (172,704)
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Operating loss (297,077) (83,271)
Interest 18,196 43,303
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Loss before tax (278,881) (39,968)
Tax (55,676) 20,575
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Retained loss for the year (334,557) (19,393)
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Adjusted EBITDA excl. share based payment (FRS 102 section 26 adj) 507,249 478,517
Adjusted Profit on ordinary activities before taxation and excl. share based payment (FRS 102 section 26 adj)






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Loss per share - basic (0.33) (0.02)

Loss per share - diluted



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  Audited   Audited
12 Mths 12 Mths
31.12.15 31.12.14
£ £
Net cash generated from operating activities (601,066) (257,881)
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Cash flows from investing activities
Payments to acquire tangible assets (1,568,302) (574,885)
Interest received 18,196 83,082
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Net cash from investing activities (1,550,106) (491,803)
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Cash flows from financing activities
Issue of ordinary share capital 3,007 3,710,978
Repayment of bank loans - (1,789,061)
Interest paid - (39,779)
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Net cash used in financing activities 3,007 1,882,138
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Net (decrease)/increase in cash and cash equivalents



Cash and cash equivalents at the beginning of the year



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Cash and cash equivalents at the end of the year



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    Audited   Audited
As at As at
31.12.15 31.12.14
£ £
Fixed assets 7,203,368 6,019,766
Current assets 10,378,126 10,825,918
Creditors due within one year (2,306,678) (1,713,863)
Creditors due after one year (306,323) (269,245)
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Net assets 14,968,493 14,862,576
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Called up share capital 5,051,510 5,048,503
Share premium account 8,554,912 8,554,912
Revaluation reserve 1,073,650 1,093,389
Profit and loss reserve 288,421 165,772
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Shareholders’ funds 14,968,493 14,862,576
--------------- --------------


The net asset value of the Group as at 31 December 2015 was £14,968,493 which includes:

  • Fixed assets of £7,203,368 includes sites at Tenterden and Kit’s Coty, which were revalued by Savills in February 2015, as well as the vineyard development expenditure at Kit’s Coty which is capitalised at cost. The Group applied the transition arrangements of section 35 of FRS102 and used the February 2015 valuation as the deemed cost.
  • £4,974,885 of stock is valued at cost being the lower of cost or net realisable value.
  • The Company is required to value net assets in accordance with the Company’s reporting standard (UK GAAP). The assets (wine stock, land, vineyard) are held at cost which the Directors believe is considerably less than the realisable value.


1. The financial information set out in this announcement does not constitute statutory accounts. This financial information has been extracted from the audited full accounts of the Group for the year ended 31 December, 2015, which will be posted to shareholders in May 2016.

2. Section 26 of FRS 102 requires us to restate our profit to attribute a notional cost of non-cash share option agreements to the business. Once this has been applied the accounts show a reduction in profit of £420,286 (2014: £172,704) resulting in a Group pre-tax loss of £278,881 (2014: pre-tax loss of £39,968). In November 2015 there was an amendment to the terms of the 2013 share options resulting in the cancellation of 6,311,112 share options. FRS102 section 26 requires the Company to accelerate the charge associated with cancelled share options. The accelerated charge in 2015 associated with the cancelled 6,311,112 share options is £346,669.

3. The Directors of the Company do not propose a dividend for the period.


Below are the adjustments showing the effect of the transition to FRS 102 on the 2014 results.

Profit and loss account        


12 months to 31.12.14
Profit after tax under UK GAAP 34,731
Adjustment to goodwill amortisation under FRS 102




Loss after tax under FRS 102 (19,393)


Balance sheet Audited as at
Fixed assets under previous UK GAAP



Adjustment to goodwill amortisation under FRS 102





Closing fixed assets under FRS 102



Creditors more than one year under previous UK GAAP (102,089)
Adjustment to the deferred tax in respect of revalued fixed assets (167,156)
Closing creditors more than one year under FRS 102 (269,245)
Revaluation reserve under previous UK GAAP 1,260,545
Adjustment to the deferred tax in respect of revalued fixed assets (167,156)
Closing revaluation reserve under FRS 102 1,093,389
Profit and loss reserve under previous UK GAAP



Adjustment to goodwill amortisation under FRS 102




Closing profit and loss reserve under FRS 102 165,772

Under FRS 102 amortisation is charged on the carrying value of goodwill at transition on 1 January 2014 and is amortised over 10 years.


Short Name: Chapel Down Group plc
Category Code: FR
Sequence Number: 522676
Time of Receipt (offset from UTC): 20160421T175546+0100


Chapel Down Group plc


Chapel Down Group plc