Adnams ‘to undergo change as it positions for further growth’
In its results for the 12 months to 31 December 2023, it reported a 3% sales rise to £66.3m with stronger demand in the on and off-trade channels in the second half of the year.
Moreover, it also reported year-on-year beer volumes increased by 3% in the second half of 2023 and 11% in the first quarter of 2024.
Operating losses widened to £2.5m (up from £1.2m in the previous year) due to higher costs while it posted a pre-tax loss of £4m (against £2.3m in 2022).
Adnams said while multiple factors had continued to challenge the brewing and hospitality sector throughout the year, it was pleased to report the 3% sales rise, which was its third consecutive year of growth following the pandemic.
Distinctive strengths
The company said its full year loss had widened to £4m due to the aggregate impact of cost increases including interest, adding falling inflation had eased some costs in the current year.
Furthermore, the business added this, alongside the full-year impact of previously announced cost reduction measures and continued disciplined cost management, would support its profit improvement plans for the current year.
For its off-trade sales, Adnams said these had risen 14% year on year, supported by new national listings with several major retailers, wholesalers and pub companies.
It cited Ghost Ship 0.5% ABV as its best performer with volume and value growth of 12.4% and 15.6% respectively.
CEO Andy Wood, who is set to step down from his role at the end of June and replaced by Jenny Hanlon, said: “As we continue to pursue our strategy, it is important we leverage our distinctive strengths as a heritage-rich, innovative company to their fullest.”
Significant equity
He added: “The Adnams brand continues to hold significant equity and is championed and cherished by its customers.
“The coming months will see the company undergo further change as it is positioned for further growth.
“This change is likely to result in a simplified operating model that encompasses the things the business does well while reducing its borrowings, susceptibility to economic shocks and building greater resilience.”
Earlier this month (May), Adnams confirmed it was revealed it was continuing to explore a range of options to fund its further growth.
In February, it was revealed the Suffolk brewery had called in advisers to explore a range of options to fund its future growth plans. The objective was to raise capital to pay down bank debt and fund further growth initiatives.
