Gage Roads Brewing Company’s continued growth of independent retail sales has not been at the expense of sales through its established channels, the company says.
Sales to national independent retailers were up by 256 per cent in the financial year to March 31, Gage Roads informed the ASX on Friday.
“The national retail chains also continue to grow with sales to consumers at store level up 12 per cent on a MAT (moving annual total) basis,” the brewer said.
“The company is pleased to see that the sales growth in new independent channels to market has not come at the expense of our existing channels, but rather, the increased consumer awareness has supported growth of Gage Roads’ brands in all markets.”
However, sales from the company into the national retail chains were down nine per cent, continuing the impact of an unwinding of a high inventory balance held by retailers at the start of the financial year.
“This position has improved significantly from the previous quarter, with sales during Q3 to the channel up 80 per cent over Q3 FY16,” Gage Roads said.
“The company expects another strong result in Q4 to completely reverse this shortfall and bring full year sales to this channel in line with those achieved in FY16.”
The shift in sales away from contract brewing volumes towards higher-margin proprietary brand volumes continues to deliver an uplift in revenue and gross profit margins, Gage Roads said.
It said proprietary brands have so far represented 32 per cent of the sales mix in FY17, up from 28 per cent last year. Gross profit margin has risen to 56 per cent from 52 per cent over the same period.
Former Foster’s executive joins
In April, former Foster’s Australia and Treasury Wine Estates senior executive Graeme Wood joined the board of Gage Roads as a non-executive director.
“His appointment complements the board’s existing skill sets, providing strong expertise in sales, marketing and customer focus,” Gage Roads said.