As anticipated the FY23 results are strong and in line at an underlying level, whilst statutory PBT (pre exceptionals) is up by a standout 163%. In short, a further reminder of the extensive progress being made by Chapel Down. With clear growth plans in place, we envisage further transformative years ahead. Whilst the move to IFRS accounting necessitates a re-modelling of our forecasts, they continue to show a 3-year revenue CAGR of 15% and continued profit progression. Our updated Base case analysis informs a new 12m TP of 78p. With respect to this we make two crucial points: (i) the valuation is underpinned by an adj. NAV estimate of 62p, which reinforces the asset backing thesis; and (ii) the implied 7.5x EV/Sales multiple compares very favourably to the 12-14x recently paid for UK premium drinks brands (Hambledon and The Lakes Distillery). We maintain a Buy on this attractive growth story.
