February 6, 2018 / 8:56 AM / a year ago

UPDATE 1-France's MBWS warns on earnings as Poland sales plunge

(Adds details of Polish sales, share price)

Feb 6 (Reuters) - French spirits producer Marie Brizard Wine & Spirits said on Tuesday it expects to report an annual loss due to significant difficulties at its Polish subsidiaries.

The owner of the Sobieski and William Peel brands will appoint a new general manager in Poland, where fourth quarter net sales plunged almost 74.4 percent to 6.1 million euros due to price pressures in country’s clear vodka market.

Marie Brizard now expects a loss in earnings before interest, taxes, depreciation and amortisation (EBITDA) of about 6.5 million euros ($8.05 million) in 2017.

As a result of the difficulties, the company will also review the already pushed back “BiG” strategic plan objectives, which currently sees 2020 EBITDA of between 68 and 77 million euros.

Shares in Marie Brizard fell 16.15 percent to 9.6 euros in early trade.

Ania Jakubowski, the new manager, who previously worked for The Coca-Cola Company in Poland, will overhaul sales practices in the country, where the slowdown contributed to a 14.1-percent decline in the whole group’s sales to 104.9 million euros.

Market conditions in Poland led to a sharp increase in trade support as distribution agreements put in place at the end of 2016 failed to deliver expected sales.

The company said an audit of sales and accounting processes could lead to the restatement of prior quarterly net sales in Poland.

Marie Brizard said it should, however, see a gradual improvement in the Polish market with the first signs of price increases in the vodka market and the production start of the new Lancut distillery in the first quarter of 2018, leading to margin expansion.

$1 = 0.8076 euros Reporting by Piotr Lipinski in Gdynia; editing by Jason Neely and Kirsten Donovan

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