Chapel Down Share Discussion Threads

[faz] 13/9/2024 17:25

I was as disappointed as anyone with the figures but this is a very good entry point. The proposition doesnt hinge on stock levels, it hinges on the quality of the wine. Does anyone think the stock wont sell? And last season's excellent harvest only reinforces the business case. And they are in a very good position to recruit a very good CEO - as long as the CFO stays.

[timmy40] 05/9/2024 18:12

Not selling now, after this drawdown, the share price will consolidate, let's hope the CE is going ahead of inward investment following the strategic review

[dartboard1] 05/9/2024 16:53

True, to an extent. They have quite a few they age (but probably not the high volume stuff). But also as the estate grows there will be a lag where current year harvest needs to mature, which is larger than the current year ready to sell... but take your point on having to maintain sufficient sale of current stock balances

[kaos3] 05/9/2024 15:19

one has to be aware that only tiny percentage of grapes are ok for ageing. depending on the year quality and grape sorts if one aims high premium segment

most grapes are not suitable

[dartboard1] 05/9/2024 15:04

Operating cash flow is a bit different for a wine business than an ordinary operating business. Inventory increases will be a negative to cash flow, however the goal of a growing vineyard is to build inventory so they can sell aged vintages into future years. Inventory balances can also be used as collateral for debt financing. While a retailer wants to operate with the thinnest inventory possible ... if the brand builds, then a growing inventory is a good thing not negative ... even if it's showing a drag on operating cash flow

[castleford tiger] 05/9/2024 14:16

braver than me i baled yesterday apart from 10k shares.

had a nice chunk almost 100k left but cash flow worries me.

tiger

[wiganpunter] 05/9/2024 12:17

Hi , I listened to it and have a pretty large position . i have to be honest it was really strange - the Tim Taylors job is at best equal in size and doesnt start until march 2025 and its private company so why would that even need to be done in the way its been done.
so the strategic review was announced, Carter as ceo is privy to it and in the midst of that interviews for a parallel job . to me that means he either thinks its going to be sold and is jumping for the next thing as he doesnt have a lot of equity or has fallen out with the board who maybe want to sell it and he thinks its a longer term build .
the start really is who funds the new winery - a buyer or shareholders . at 6m capacity with the current assets added into the new ones you get comfortably to a £75m plus turnover so on 2x sales thats a £150m company today so maybe its just a disagreement over what option to take but the stock should be a good story here once this is out of the way. or maybe option 3 is they dont think he's the right guy to carry on with it having been through the process - wray and Spencer are key here and they might want a different face .
people making comments on harvest are missing the point - the inventory here is substantial so an ok harvest is irrelevant - it is about can you do 6m bottles a year at Prosecco prices and make the distribution work for you which for me has been the issue. I think it gets sold still or a large investor comes in with distribution power and you get to stay in the story but it was rubbish how they have handled this no excuses so am trying to see the end game through the noise.

[kaos3] 05/9/2024 04:13

as i am close to the wine region - exporting world wide

wine is not about producing. it is about marketing and distribution.

about getting premium margins for the same quality. like 10 x. getting into fancy restaurants, duty free shops and similar.

i expected much better job done on selling the UK origins.emotions. story telling.

too much talk and effort towards producing. there is over supply. not enough about getting into world best restaurants. our producers were perfect in production 2 decades ago. it took them 2 decades to get the margins. towards like the french command. evaluations, press, being exploited by the first contact distributors etc etc .... slowly building up premium.... it takes decades


OT - how the region looks


an article about how it works

.....for him Italy is the most lucrative market. Japan is very important with a small amount sold in Austria, Slovenia, Spain and Poland.

Mlečnik wines are not for everyone’s pocket or palate. Costing € 13.5 for Ana to €25 for Chardonnay, they are for people who seek wines for the soul. I have coined the term ‘intellectual wines’ for these wines........


.....Movia has been owned by the Kristančič family since 1820. Thanks to Ales Movia is considered one of the best producers of Slovenia. He owns 22 hA vineyards about 8 hA of which are in Italy. Elevating from grape growing to wine making, 90,000 to 130,000 bottles are produced every year. Italy is his best market though he sells all over EU, US, Japan and other countries.......

[ayl30] 04/9/2024 22:01

A few things stuck outI interpreted one comment as meaning we would hear result of strategic review very soon, Chairman said they were limited by takeover panel from further comment, I noted the word takeoverI got the impression that this years harvest was expected to be normal rather than bumperObviously they have a lot of 2023 stock to shift, that will mean a downward retail pricing I thought before and today confirmed my concern that production is running ahead of demand, perhaps why they are talking about stimulating exports - perhaps a takeover by a group with world wide sales organisation would help here.3 years time latest plantings will be peak maturity, that adds to need to raise sales baseThey knew that sales were running behind plan, presumably they did not want this known by market as it would hamper takeover/ funding discussions Was ch exec fired? If things were as rosy as they paint it surely he wouldn't resign and forfeit rewards. What's the deal with the company he is going to, is idea he will take it onto stock market?

[timmy40] 04/9/2024 17:41

Did you watch the presentation any update please ?

[castleford tiger] 04/9/2024 13:07

smashing prices like that does damage the selling price.

I worked with SARA LEE many years ago and the big boys bankrupt the uk divison

They were massive in USA at the time.

Giving stuff away on crazy deals is no good.

I can see a cash flow crisis here.

So 80,000 shares sold and kept just 10k

regards
tiger

[dicktrade] 04/9/2024 11:34

CT,
Good to see you post after this morning's drop, very honourable.

But I would say that your faith in Andrew Carter was not misplaced, i think he is excellent and the fact that he is leaving at what seems pretty short notice tells me that something is not right at Chapel Down.I did not like that they discounted so much and so often in Sainsbury's and Marks'. Maybe they had to to make sales but when the price is £30 and you discount down to £24 on a regular basis then £24 becomes the maximum price that people will pay, so i think this process undermines the brand.
FWIW worth i got out for the above reasons and the poor summer weather affecting this years harvest just before the strategic review was announced and was kicking myself for missing out on the share price rise that that produced, but obviously now i made the right (lucky) decision.

GLA

[castleford tiger] 04/9/2024 09:47

Castleford tiger.... Remember when you posted this to me? "I think you are talking yourself out of an investment.
Try HSP yielding 9% or LGEN no worries here."

Lol. I literally told you about this... And in your ignorance you say I'm the dilluded one.

MORTALITY

You flagged up several concerns over a long period of time.
I had an opposite view/opinion.
Did i use the word "dilluded"?

It would appear that some of your concerns were justified and i was being swept along on a wave of good news from management.

I have cut my position today ( still getting almost 3x my investment) on my original stake.
I clearly had too much faith in Andrew C and the news flow.

Its so difficult to value because its in the growth phase and its capital heavy.

I have kept 10,000 shares and will watch.
If things are so bad i do question why its held up so well

tiger

[kaos3] 04/9/2024 08:52

1000 acres farm produced 140 gbp profit

clarcson ... car journalist

that is the reality of the agri sector more or less atm

hence i am interested

[boonkoh] 04/9/2024 08:39

The looming question is this... With the huge sparkling wine maturing inventories about to hit the market next year...Is there enough demand in the market to absorb? Not just Chapel Down but all the other English sparkling wines? And especially as Champagne is also seeing a glut of inventory too due to soft demand atm?If the answer is no then next year's ASP, revenues, profits are in deep distress already. And there are no deep pockets here to tide over a few financially challenging years.

[mortal1ty] 04/9/2024 08:00

I think they've raised the price too much. People don't want it

[yohoho] 04/9/2024 07:44

These results are shocking. Blaming a bumper harvest for profit reduction is nonsense and the real damage was done by the retailers restocking or price gouging. IF a major prove interested in acquiring what has always been a poorly run company it will need to be on punative terms.

[mortal1ty] 04/9/2024 07:39

Castleford tiger.... Remember when you posted this to me? "I think you are talking yourself out of an investment.
Try HSP yielding 9% or LGEN no worries here."

Lol. I literally told you about this... And in your ignorance you say I'm the dilluded one.

[kemche] 04/9/2024 07:34

The level is much below here.

Much.

[mortal1ty] 04/9/2024 07:32

You need to ask yourself... With almost 75% of the acre mature how is this business making so little profit.

[ayl30] 04/9/2024 07:20

Online investor presentation at 4.30 today. No doubt they will be concentrating on the not so bad elements of the results

[kemche] 04/9/2024 07:19

I think I will sit this one out.

[mortal1ty] 04/9/2024 07:11

The chapel down fan club stop this from being rated what it is actually worth. 20p max.

[mortal1ty] 04/9/2024 06:16

I also told you nothing would come of the sale.

That was just the CEOs desperate attempt to exit before these results were out. In the end he couldn't sell it and so left.