Chapel Down raises profit outlook as sparkling sales grow
Net sales rose 19% to £9.4m in the first half and margins widened. The Kent winemaker is still loss-making, but expects profits above forecasts and a high-quality 2026 vintage.
Chapel Down has raised its profit forecast for 2026 after net sales rose 19% to £9.4m in the six months to 30 June, the Kent producer of English sparkling wine said in its interim results on 23 September. The board now expects adjusted EBITDA for the year to be "materially ahead of market expectations".
Gross margin climbed 3.5 percentage points to 49.6% and adjusted EBITDA rose 27% to £1.3m, according to The Grocer. The company is still loss-making: its pre-tax loss narrowed by 20% to about £550,000, from £687,000 a year earlier. The Grocer reports that the new guidance puts full-year EBITDA at least 10% above consensus, which the company's July trading update put at £3.7m on net sales of £22.1m.
Chief executive James Pennefather spoke of "growth across all channels, increasing market share and continued momentum" in the traditional method sparkling range, which by July already made up 74% of wine sales, against 70% a year earlier. He also credited millennials who open sparkling wine for informal occasions such as birthdays. The shares rose 5.4% to 48.5p on the day, PA reported via LBC.
English sparkling now prices itself against Champagne; the pre-tax profit is still to come.
Chapel Down grows fastest abroad
The breakdown in the July trading update shows where the money comes from. Off-trade sales, mostly supermarkets, rose 18% to £4.4m; Chapel Down grew 20% in an English sparkling wine category that grew 15%. Restaurants and bars added 18%, to £1.5m, with the wine now poured in 2,750 outlets and new listings with the Gordon Ramsay Group and Handpicked Hotels. Direct sales to consumers grew only 4%.
International sales are still small, at £0.8m, but rose 66%. Through its partnership with Jackson Family Wines, the brand is now sold in 31 US states and 250 Whole Foods stores, and in 19 markets overall. The pricing looks straight at France: the company says its sparkling wine sells at an index of 92 against Champagne. English fizz has been finding new shop windows too, English sparkling wine now flies with Emirates.
A warm 2026 harvest in Kent
More than half of the 2026 grapes had been picked by 23 September, and the company expects a "high quality" vintage after a late frost in May and a warm, dry summer. "The English region is coming into a multi-decade period of good temperatures for our vines, which were still green and in good condition after very little rain," Pennefather said.
The same heat is rewriting the rules across the Channel, where Champagne has had to raise its alcohol limit for the 2026 harvest. Chapel Down's net debt stood at £14m at the half-year, against a revolving credit facility extended to £25m. A harvest update will follow once picking ends; until then, the upgrade describes a company that sells more and earns better margins, but has not yet made a pre-tax profit in the half.
