A Record Brewing Year For Adnams
Adnams has reported a record brewing year for 2016 with volumes passing the 100,000 barrels mark for the first time in the English regional brewer’s history. Overall turnover for the year to 31 December 2016 was also a record high at £70.3 million – up 7% on 2015 – and operating profits were £3.94 million. The operating result was 3.8% behind the previous year, adversely impacted by the fall in Sterling in the second half of the year. Adnams has substantial Euro and US Dollar costs relating to wine and hop purchases.
Profit before tax at £5.02 million was 23% ahead of 2015 driven mainly by the profit made on the sale of the UK distribution rights for Lagunitas beer. The sale took place at the half year, and second half operating profits were consequently reduced.
Jonathan Adnams OBE, chairman of Adnams, comments: “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. Whilst 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.”
He continues: “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.”
Although Adnams remains committed to being a major cask ale producer, it was the sale of beer in kegs, bottles and cans that drove increased production in 2016. Adnams is making new investments in its brewery including extensions and improvements that will increase beer conditioning and filtration capacity, enhanced cooling and an automated kegging line. Entailing investment of £7 million, the brewery project will be complete by the middle of 2017.
