(Finance) – Satisfaction with business developmentwith a stable 2023 turnover despite the slowdown in consumption and an EBITDA at the top of the guidance, and frustration with the stock market performance, with the title more than halved from the values reached two years ago, before the acquisition of Blackbeard caused the group to make yet another leap in size. This is what he proves Alessandro Mutinellipresident and CEO of Italian Wine Brands (IWB), observing what is happening to the wine group listed on Euronext Growth Milan.
“The 2023 was a chiaroscuro yearin the sense that we managed to recover in a good way the margins that they had lost in 2022 due to the increase in all production factors – the CEO tells Finance – And it must be considered that the global wine market has contracted , while we managed to keep turnover practically unchanged and improve margins, so certainly it was a very positive year for us“.
IWB recorded total revenues equal to 429.1 million euros last year (compared to 430.3 million pro-forma at 31/12/2022), with a EBITDA which should land in the highest part of the guidance (40-44 million euros). The complete data will be approved by the Board of Directors on March 18th.
“One thing that pleases us, and I imagine our shareholders too, is the cash generation, given that historically and structurally we have a 55% cash generation on EBITDA, but this is absolutely not reflected in the prices, considering the strong discount on the stock marketwhere we are around 6 times the EBITDA, despite being the main private operator in the world of Italian wine”, says Mutinelli.
Recalling that IWB is a public company, having a free float of around 70%, the CEO maintains that “there has been little by little a hemorrhage of investorswho have gone somewhere else, while historical investors, who have been in the capital since the beginning, do not feel like buying at the moment, even given the low volumes, maintaining a wait-and-see position”. of the stock’s decline in sales which affected the majority of small and medium capitalization companies, and also speaks of a “disaffection towards the title“. The company is responding to this with engagement activities towards investors and with the purchase of its own shares, even if the few exchanges on the market do not help.
Mutinelli hopes that interest in the stock will return, but in the meantime he says he is focused on the business: “Il Our job is to bring consistent results, to manage the company efficiently, to keep up with the times, to understand where consumer demand is going and consequently offer them products in line with their desires. And in this we have always achieved important results. Investor interest will come.”
The CEO recalls that “in 2021 we had reached more than 400 million euros of market cap and the company was much smaller and less performing than today. The company has therefore grown in two years with strategic acquisitions, however the listing has is halved.” Furthermore, he says he was approached “many times” by private equitypointing out that private deals off the stock exchange on companies significantly smaller than IWB were made at multiples of 10-11 times EBITDA, almost double the multiples at which the group trades today on Piazza Affari.
After the integration of Blackbeard, which went “very well”, IWB could be ready for new M&A. “For a year we were at a standstill, having invested 220 million euros in acquisitions since 2021 and having to integrate various entities. In 2023 we “digested” everything we had acquired to extract synergies and reduce the financial position, therefore 2024 could be the year to look at other acquisitions“. Regarding potential targets, he says: “Our mantra right now is to say: less volume and more value, because on a global level we think there will be a reduction in consumption in terms of volume, but not in terms of value. So we want to develop and propose brands that are positioned in a higher range compared to entry-level products, where there will be increasingly more competition for survival.”
Further growth could come from geographic diversification. “Today IWB sells wine in around 80 countries – Mutinelli – And while the main importers of Italian wine – United States, Germany, UK and Switzerland – had a slight contraction last year, we instead saw a strong increase in countries that we still include under the heading “Others”. These countries – around 40 states from Asia to Eastern Europe, from Africa to the Middle East and South America – are worth around 25 million euros in turnover for us, out of a total of 430 million euros, but are growing at rates of 30%” .