Adnams pinpoints 2016 as its 'record brewing year'
Adnams has stated 2016 was a record brewing year for the company, with volumes passing the 100,000 barrels mark for the first time in its history.
The Suffolk brewer, distiller and retailer achieved sales of £70.3m and £3.9m in operating profit for the 12 months to 31 December 2016, according to its latest results announcement.
Commenting on the performance, chairman Jonathan Adnams OBE, said: “Adnams saw strong growth in the volumes that it brewed and distilled in 2016. Brewery sales volumes rose by 9% and distillery volumes by 66%. A record level for both parts of the business. While the depreciation of Sterling depressed profits, underlying trading was good with our shops trading well. We continue to innovate and invest in the long-term future of our company.”
Beer sales increased by 9% compared to 2015 and sales of its own spirits grew by 66%, he said. Overall turnover was also at a record high at £70.3m. Profit before tax (£5m) was 23% ahead of 2015, driven mainly by the profit made on the sale of the UK distribution rights for Lagunitas beer.
“We have witnessed some substantial changes in our business over a short period as beer consumers have changed where they buy and what they buy. The long-term shift towards beer being bought from supermarkets and other shops, with less being sold in pubs, has continued and the taste for high quality products from small producers has also grown. We have been closely watching these trends and adapting our business accordingly.”
Adnams added that although the company remains committed to being a major cask ale producer, it was the sale of beer in kegs, bottles and cans that drove its increased production last year. “These changes emphasise the importance of the new investments in our brewery. This project will be complete by the middle of 2017. We will have spent about £7m on extensions and improvements that will give us beer conditioning and filtration capacity, enhanced cooling and an automated kegging line.”
The company’s spirits business had “a particularly good 2016”, with strong growth across all channels including supermarkets and its own shops. Its key product Adnams Copper House Gin continues to grow its reputation as “one of the best drinks of its type”.
“The tripling of capacity that we put in place at the start of 2016 came just in time to allow us to fulfil the demand that we have seen”.
Adnams’ retail business also performed well in 2016, though results were affected by a depreciation of sterling, as imported wine forms a major part of its sales. The company opened a new shop in Felixstowe during the year and towards the end of 2016 it converted a café in its Bury St Edmund’s shop into a “mak your own gin” experience centre, modelled on the existing facility in Southwold.