Disappointing year end for Sabaté

- Last updated on GMT

Related tags: Economics

The troubled Sabaté Diosos group posted mixed results for its
latest quarter.

The troubled Sabaté Diosos group posted mixed results for its latest fourth quarter. Losses in the corking division were cut back but the barrel division continued to struggle.

In the last quarter to December 2002, the France-based wine packaging specialist achieved a turnover of €48.8 million. The figure was buoyed by a strong resistance in the cork division, despite difficult conditions in the wine market.

The division registered a drop in activity of 7.3 per cent, which compared favourably to a loss of 15.8 per cent for the previous quarter. However, the company said that a noticeable decline in the barrel division activity, was, according to a company statement, "due to an overall deterioration in the economic environment and difficulties in the wine market, accentuated by adverse weather conditions in Europe".

The last quarter results means that the company ends the year with a total turnover of €201.7 million, which it says is within the forecasted sales bracket announced in July 2002.

The group added that the net result for the year has been strongly influenced by the extraordinary items related to both the plan to restore profitability in the cork division, and the closing down of the floor division. The 2002 results also reflect a significant drop in debt due to cost cutting measures initiated in the first quarter.

In 2003 the group predicts that its efforts to reduce costs and the focusing of its activities will have a significant and positive impact on results. The next stage of its restructuring will concern commercial projects including the extension of the Altec range, a new distribution subsidiary for Sabaté in Italy and the motivation of sales forces.

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