How was 2017 for Purcari Wineries?
The Group had an excellent year, on multiple dimensions. In terms of financial results in the first three quarters, our sales were up 35% vs. the similar period last year, while our net income marked a 47% increase. We have also strengthened our position in the Romanian market and we now are the clear leaders of the premium segment, reaching a 26% market share, with our Purcari and Crama Ceptura brands combined, according to Nielsen. Four years ago we were still in single digits territory market share wise, so we are pleased with the performance against a strong competition we have a lot of respect for. Finally, in 2017 Purcari received 8 awards at the prestigious Decanter London competition, a testament to our commitment to offer the best quality to our consumers.
How do you see 2018?
We’re excited about 2018. Globally, it has not been an easy year for the traditional wine producers. The International Wine Organization estimates one of the poorest grape harvests over the last several decades, with annual drops ranging from 6% in Chile to 23% in Italy. The global press has worsened the perception by running apocalyptic titles on the expected wine shortages and resulting price rises.
In contrast, Romania and Moldova are an exception from the global trend, with production estimated to grow 64% and 20% respectively, according to the International Wine Organization. Indeed, a good year both quantity and quality wise. As a result, we expect 2018 to be a good year for the margins of local producers, given global supply shortages and rising prices, but also a great year for consumers, since 2017 looks to be an excellent vintage.
What are the main trends you see in wine consumption? Do the new generations like wine?
We’re encouraged by the millennials’ openness to wine. Certain studies show millennials prefer wine over beer and have come to account, by 2015, for over 40% of global wine consumption according to Wine Market Council. It seems to be a secular trend, at least in the US, where a Gallup survey shows wine and beer nearly even in terms of consumer preference vs. a 20 percentage points gap in early 90s.
At the same time, consumers are becoming increasingly educated and sophisticated. They are also willing to pay more for high quality, premium wines, which is an affordable, democratizing luxury in an era where income inequality is a global concern. Unlike owning a luxury car or travelling to fancy vacation spots, one can indeed afford an excellent wine, even at under 10 euros, and be sure they have access to the same level of quality and sophistication the wealthier off do.
About Purcari Wineries Group
Purcari Wineries Group manages approximately 1,000 hectares of vineyards and 4 wineries located in Romania and Moldova: Purcari, Crama Ceptura, Bostavan and Bardar. The Group is a leading premium player on the Romanian market according to Nielsen and the largest wine exporter from Moldova, delivering to over 30 markets. Purcari is also the most awarded winery from CEE in 2015-2016 at Decanter London.