Lower shipment volumes prompted a 4-per-cent dip in second-quarter revenue at Corby Distilleries Ltd., the company said Wednesday, adding the apparent rise in profit does not reflect current market conditions.
The Toronto-based liquor producer said its earnings picture only becomes clear when factoring in a significant impairment charge that dragged on the bottom line during the comparable year-earlier quarter.
Corby reported profit of $9.4-million or 32 cents per share for the quarter ended Dec. 31, a seemingly sharp improvement over the $1.1-million or 4 cents a share booked during the same period in fiscal 2010.
After factoring in the $9.4-million impairment charge for the comparative period, however, Corby said profit actually declined 13 per cent from where they were the year before.
Corby attributed the decline to low shipment volumes and inconsistent sales that also affected its top-line performance. Operating revenue dipped 4 per cent to $45.2-million compared with year-earlier levels of $46.9-million.
Consumer confidence levels and purchasing patterns have still not fully rebounded to levels seen before the economic recession, the company said.
"The spirits industry in Canada is showing modest signs of recovery on an overall basis; however, this growth is inconsistent across provinces and across spirit categories," chief executive officer Patrick O'Driscoll said in a statement.
"In the context of strong competition, we have continued to increase our level of investment in areas where we see growth potential, and continue to seize opportunities to increase innovation on priority brands."
Corby produces alcohol under a number of brands, including Wiser's Canadian whiskies, Lamb's rum, Polar Ice vodka and McGuinness liqueurs.