Most of the volume produced by NZ’s Moa Brewing Company is now packaged in a new lower cost bottle, which CEO Geoff Ross says will give the NZ company significant savings going forward.
The standard crown seal bottles were introduced to replace the signature cork and cage format following a review of the company’s packaging cost of goods.
Speaking at Moa’s annual shareholders’ meeting late last week, Ross said the company’s sales volume grew 40 per cent in the recent financial year and that momentum is expected to continue.
“We did a calculation recently which shows that one Moa beer is being opened every five seconds,” he said.
“The key markets we are focusing on are the New Zealand and Australian markets. These markets grew 82 per cent and 79 per cent respectively.”
Ross said Moa had recorded sales of just over $6 million (NZD) up from $4.5 million last year. The company lost $5.5 million, down from $5.8 the previous year.
“We would see these losses reducing significantly… Greater sales will contribute to this as will margin improvement and reductions in overheads,” he said.
“Like you I am also a Moa owner, investing at the IPO over two years ago, and would obviously like to see that share price a lot stronger than it is now. The key cause for this value drop, was due to the distribution changes two years ago, and the poor performance that triggered that.
“This is now well behind us now, we are demonstrating strong growth, in a growing category, and are progressing well through the core steps required to build a beverage business.
“Our view is that continuing to deliver on these growth rates, and continuing to improve the financial metrics, to be a leader in a high value category — will have to create a higher value in our share price,” said Ross.
New Moa chair relishing challenge
Also at the meeting, chairman Ashley Waugh told shareholders of his belief that Moa has the ingredients to bounce back from its struggles of the last few years.
The former CEO of National Foods Australia – which is now owned by Lion – said that one of the reasons he joined in January was the potential he could see in the company.
“For many years I worked in specialty cheeses – the same drivers that saw speciality cheese volumes grow at 20 per cent per annum are evident in craft beer as consumer taste preferences become more sophisticated and they migrate from everyday beer to a craft product,” he said.
“Like any other company, Moa has its commercial challenges to work through. In my business career I’ve been there before. The very best example would be King Island Cheese Company in Australia, then a struggling PLC [publicly listed company], now a vibrant profitable brand. I’m confident the ingredients for success are present.”
Waugh said he will give to Moa his experience in building brands and commercial outcomes, based on a thorough understanding of FMCG and particularly food and beverage.
“We need to continue working on the commercial aspects of our business around the cost of product, overhead and distribution aligned to keeping the business simple,” he said.
“I know that the company’s share price is not what you signed up for, so thanks for staying with us,” he told shareholders.