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Duckhorn’s Sales Rise 13.7%, Gross Profit Up 18.3% In First Quarter

December 9, 2021

California-based Duckhorn reported net sales of $104.2 million for its fiscal first quarter 2022, up 13.7% compared to the same period in the previous year. Gross profit for the period was up 18.3% to $52.4 million. The company’s three-tier business made up 68.5% of sales in the first quarter of 2022, with its California direct-to-retail business comprising 16.4%, and its DTC program contributing 15.4%. The DTC and direct-to-retail share of sales both represented increases from the year-earlier period, when DTC was 12.6% of sales and direct-to-retailer was 14.3%.

Duckhorn posted a 7.5% increase in volume for the quarter—a slower rise than the 39.8% surge seen in Q1 2021—and a 6.2% price/mix contribution as the source of sales growth. The price/mix aspect of the company’s growth was attributed to the strong performance of both its California direct-to-retail business and DTC sales. Overall, Duckhorn attributed much of the progress in Q1 2022 to the on-premise rebound, following the shutdowns that plagued 2021.

The company’s adjusted EBITDA for the quarter was $38.1 million, up 13%, driven by higher net sales volumes and an improved gross profit margin. Although the EBITDA increase was robust, Duckhorn noted that growth was somewhat offset by higher selling costs and other increased costs associated with being a public company. The company went public in March of this year, making its debut on the New York Stock Exchange.

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