Gage Roads Brewing has reported a 63 per cent earnings increase for the 2016-17 financial year, with Single Fin Summer Ale its star performer.
Single Fin grew 62 per cent over the prior year to become the company’s second highest selling individual brand, the brewer announced on Tuesday.
“Little Dove New World Pale Ale, 2016 Australian International Beer Awards Champion Beer of Show, continues to impress and is contributing strongly to new sales and new distributions,” Gage Roads said.
The company reported EBITDA of $4.4 million, a 63 per cent increase on $2.7 million last year, when the company returned to profit.
Sales to national independent retailers were up 270 per cent, while sales volumes to the national retail chains were in line with FY16.
“Maintaining volumes in this channel is a strong result given the company’s products underwent a price increase during the year to reposition price points with those offered in the other channels to market,” Gage Roads 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 Gage Roads’ brands in all markets.
“Consistent with our strategy, contract brewing volumes are being unwound in an orderly fashion and converted to higher margin proprietary brand sales.
“Accordingly, sales volumes of the company’s contract-brewing division, Australian Quality Beverages (AQB), were down 13 per cent compared with FY16 and total volumes were maintained at 11 million litres,” the brewer said.
Record cash reserves
Net profit after tax was up 229 per cent to a record $2 million, while the company ended the quarter with record cash reserves of $7 million.
“With an additional $4 million in its credit facility ($6 million facility drawn to $2 million) the company is in a strong net cash position ($5 million), providing an excellent financial platform from which to continue to execute its ‘Returning to Craft’ strategy,” Gage Roads said.
Gage Roads shares are currently trading at 4.1 cents, up eight per cent on opening.