Performance Overview

For the year ended December 31, 2018. the Group recorded revenue of $783.7m versus $745m in 2017, an increase of $38.7m or 5.2%. While a change in accounting treatment to reflect gross revenues inclusive of excise taxes was made in 2018 and resulted in the restatement of our 2017 results, revenues net of excise taxes increased from $569.6m in 2017 to $602.8m in 2018, an increase of $33.2m or 5.8%.

This revenue growth was a direct result of increases in each business segment except bulk business, with notable increases of 8% in Bitters, which represents approximately 26.6% of total sales, and 18% growth in export rum sales, which represents 6.6% of total sales. Local rum sales, which contributes 49% of total revenues, grew by a modest 1.6% in 2018. Our performance on the local market is notable given the challenging economic environment and relative volatility experienced during 2018.

The commodity rum business, or unbranded business, while reduced in revenue from prior year, reported a positive gross profit as we focused on bulk blends and co-packaging contracts instead of bulk base rum sales. The results of the Group’s consistent focus on profitability is evident in the 2018 performance and we will continue this focus going forward.

The Group’s performance demonstrates the rewards of the strategic decision to continue to provide the local market with the highest quality products while expanding the sale of profitable branded products through brand building internationally. Despite a 3.7% (or $14.1m) increase in the Cost of goods sold, Gross profit increased by 6.7% (or $24.5m), from $367m in 2017 to $391.5m in 2018.

The recognition that significant growth potential lies outside our borders, informed the strategic decision to focus on the advancement of our brands in key international markets. This investment resulted in an increase in Marketing expenses of $27.1m or 52.2% over prior year and is consistent with the Board’s acknowledgement of the need for greater reinvestment of profits in growth markets. Of particular note, for 2018 was the introduction of our rum and bitters brands into China, and our Lemon Lime and Bitters beverage into the USA.

In 2019 we predict that our focused marketing efforts will result in additional growth across the Americas, Europe, Russia, Australia, Asia and Africa. Increased direct targeted marketing efforts, coupled with continuous improvements in supply chain and operational efficiencies will ensure that Angostura Limited stays on the upward profitability growth path witnessed in 2018.

The Board of Directors is proud to report an increase in profit after tax of $18.8 million or 16.9% for the fiscal year ended December 31, 2018 over the comparative period last year. Profit after tax for the fiscal year was $129.9m (2017: TT$111.1m) with Comprehensive Income for the period of $131.6m compared to $105.2m in the prior year.

The strength of our Balance Sheet is undeniable with more efficient use of our large cash reserves for investments, better credit management and the reduction of debt during 2018.

The Directors have recommended a final dividend in respect of the year ended December 31, 2018 of $0.15 per share with a record date of July 12, 2019 and payment date of July 26, 2019. Together with the interim dividend of $0.09 per share paid on September 15, 2018, the total dividend in respect of 2018 will be $0.24 per share (2017: $0.21 per share), based on earnings per share of $0.63 (2017: $0.54 per share).

Our focus continues to be the obligation to our shareholders to grow the Company and to maintain the strength of the brand in an economic environment which is challenging whilst preserving at all times the integrity of the Brand name “Angostura” and its antiquity.

Mr. Terrence Bharath
Chairman