Battling brewer Broo has today released its half-yearly results showing a net loss for the half year of more than $1.8 million for the six months to 31 December 2018.
The result saw the listed entity’s losses fall from more than $2.2 million for the corresponding period last year, but sees the brewer with accumulated losses of almost $16 million.
The losses come despite the brewer showing revenue increased $378,816 to $1.6 million. The cost of sales however increased during the period by $532,738.
No revenue was recorded from the company’s much vaunted Chinese brewing agreement.
It’s Australian brewing operations saw a fall in revenue of more than $5000, despite Executive Director Kent Grogan telling Brews News last October the company was confident of an increase in its domestic sales.
Its loss on domestic sales increased by more than $100,000 to $617,512.
The company’s accounts again highlight the results indicate a “significant or material uncertainty about the consolidated entity’s ability to continue as a going concern”.
The company says that the financial report assumes it continues as a going concern as it is exploring ‘realisation strategies’ for land it owns in Ballarat, which include a joint venture or sale of the land.
Broo acquired 15 hectares of industrial land within the new Ballarat West Employment Zone (BWEZ) Industrial Park from Major Projects Victoria, at a cost of $2.16 million in 2017, announcing plans for a $95 million ‘green’ brewery.
However, the Ballarat land is subject to a call option with Broo granting the vendor the option to buy back the land at the vendor’s discretion, in the event that Broo defaults on its promise complete the development of a commercial brewery at the site and ensure that at least 100 full time employees are employed at the site, within five years of settlement.
Ballarat City Council has advised that no planning application for the BWEZ site is currently in existence. Tenancies for BWEZ are controlled by Development Victoria.
The company’s 2017 annual report also indicated that the land was also subject to a mortgage, leaving the current value of the asset unknown.
The company’s statements also indicated it was looking at other potential sales and “has a proven ability to raise capital via both debt and equity and can access further funding if required over the next 12 months to pay debts and when they fall due.”