E-Malt.com News article: Australia: Coopers Brewery books its 23rd year of continuous volume growth
Australia’s biggest locally-owner brewer, South Australia’s Coopers Brewery, has booked its 23rd year of continuous volume growth despite lean times for the brewing industry, which have seen per capita consumption collapse to lows not seen since World War II, The Australian reported on November 7.
However, tougher trading conditions in the US in the DIY home-brew sector has punctured the value of its American brewing business Mr Beer, with the offshore operation also losing some key accounts which triggered a A$7.5 million writedown for Coopers.
It meant that for fiscal 2016 Coopers actually recorded a 16.3 per cent slide in full-year net profit, the first time in a number of years that earnings have gone backwards for the nation’s third largest brewer.
Coopers, which is owned by the Cooper family, has posted a 3.3 per cent rise in beer sales for fiscal 2016 to a record 81.5 million litres.
The positive sales momentum means that for the past 23 years, Coopers has enjoyed compound sales growth of 9.2 per cent, at a time when total Australian beer sales have been contracting.
Releasing the company’s annual results, Coopers managing director Tim Cooper said packaged beer sales during 2015-16 had risen 3.8 per cent, while keg volumes had also recorded a small but pleasing rise of 0.8 per cent.
Dr Cooper said Coopers’ revenue for 2015-16 had increased by 4.6 per cent to A$245.9 million.
However, preparation costs associated with construction of a malting plant at Regency Park, and a A$7.5 million writedown of goodwill for the Mr Beer business in the USA, meant that net profit after tax for the year fell 16.3 per cent to A$24.2 million from A$28.9 million in 2014-15.
Fully franked dividends of A$12.50 a share were paid to more than 100 members of the Cooper family, up from A$12 the previous year.
Dr Cooper said that at a cost of A$63 million, the new malting plant at Regency Park in Adelaide was the largest single item of capital expenditure in Coopers’ history.
“The work is being undertaken by South Australian firm Ahrens and comprises three steeps, four vessels, a kiln and grain silos, connected to the brewery by an overhead gallery,” he said.
“Work is progressing well and is on line to be completed by late next year.”
The plant will produce at least 54,000 tonnes of malted barley a year, one-third of which would be used by Coopers, with the remaining two-thirds available for export.
“The new plant will guarantee our supply of high quality malt for future growth,” he said.
Dr Cooper said the write-own of goodwill for its US business Mr Beer was triggered by Australian accounting standards.
“While the business initially returned good profits, recent competition from other DIY brewing businesses and the loss of some key accounts meant we had to recognise an impairment of goodwill,” he said.
Coopers purchased a majority share of Mr Beer in 2011 for A$11.3 million, with the investment returning A$5.3 million to date.
07 November, 2016