Shares in Chapel Down Group fizzed up 9% to 50p after England's best-known winemaker said it would beat market expectations, thanks to shoppers increasingly reaching for its pricier bubbly.
The company now expects 2026 adjusted earnings to top the £3.7 million analysts had pencilled in by at least 10%, with growth continuing into the third quarter and confirmed distribution wins plus a planned fourth-quarter push adding further support.
The sparkling stuff, quite literally, is doing the heavy lifting.
Traditional method sparkling wine sales jumped 26% in the first half, and now make up 74% of wine sales, up from 70% a year earlier.
That mix shift, along with some cheaper vintages coming through, helped push gross margin up to 49.6% from 46.1%.
Net sales revenue for the six months to June rose 19% to £9.4 million, and adjusted earnings climbed 27% to £1.3 million.
The business is still losing money on a pre-tax basis, though the hole is shrinking: a loss of £551,000, narrower than £687,000 a year earlier.
There's a debt story here too, but a reassuring one.
Net debt, excluding leases, rose to £14 million from £11.3 million as the company ties up cash in maturing wine stocks, a necessary cost of doing business when your best product needs time in the cellar.
But year-end net debt is now expected to come in below the £16.2 million the market had forecast, helped by tighter inventory planning and lighter capital spending.
Chapel Down has also given itself more headroom, upsizing its credit facility from £20 million to £25 million.
