Coopers cans, malt investments aid FY results

Coopers cans, malt investments aid FY results

Agribusiness
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TWO new products, an untraditional shift and investment in a new maltings plant have all helped Coopers Brewery achieve a strong result for the 2018-19 financial year.

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TWO new products, an untraditional shift and investment in a new maltings plant have all helped Coopers Brewery achieve a strong result for the 2018-19 financial year.

The launch of Coopers Session Ale and Coopers Dry, and the release of Coopers Original Pale Ale in cans, helped Coopers Brewery achieve a 2 per cent growth in sales volumes, reaching 76.8 million litres.

Session Ale was launched in packaged format in March 2018 and Coopers Dry the following September, while Original Pale Ale was made available in cans in August.

In releasing the company's annual results, Coopers' managing director Tim Cooper said Session Ale had enjoyed solid growth since its release and now represented an important part of the Coopers' ale portfolio.

"Coopers Dry entered the market to replace Coopers Clear and has been able to carve out a share of the dry or low-carb sector with sales exceeding initial expectations," he said.

"The release of Coopers Original Pale Ale in cans in August 2018 helped boost sales for our leading product, especially in the second half of the year.

"The Pale Ale cans have greatly exceeded the sales of the former Dr Tim's Traditional Ale, which nonetheless served its purpose as a trial product."

Across Australia, Qld led the way with sales volumes rising by 6.1pc. In WA sales rose by 3.1pc, Vic by 2.9pc and SA by 2pc. Sales in NSW remained steady.

Malt sales for the year rose by 132pc to 44,300 tonnes, although this came from a low base.

"The maltings is now running close to full capacity, providing significant improvements in malt quality and cost savings on one of our key raw ingredients," Dr Cooper said.

He said that while beer sales volumes had increased, profit before tax had declined to $23.1 million, compared with $34.3m the previous year.

"The reduced profit was attributable to a changing sales mix, higher barley prices and more competitive market conditions with some segments showing declines in retail pricing," he said.

"The latter renders difficult our ability to recover higher excise duties and costs arising from the imposition of container deposit schemes.

"Interest and borrowing costs increased by $1.7m during the year reflecting the debt incurred by the malting project and previous share buybacks.

"Sales of manufactured partner brands also fell 11.4pc, partly attributable to the conclusion of Coopers' agreement with Brooklyn Brewery in December 2018.

"On the other hand, volumes of our naturally conditioned ales and stout increased by 3.1pc to represent 81pc of total volume."

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Coopers paid fully franked dividends totalling $13 a share during the year, compared with $12.50 in 2017-18.

Dr Cooper said sales in the first few months of the new financial year had been positive with strong growth in XPA, which was released in can format in August.

The release of Sparkling Ale in cans in August had also been well received.

The same innovation that helped buoy the businesses finances, have also resulted in a win, with Coopers winning the Family Business Award of Excellence at the EY Entrepeneur of the Year awards.

Dr Cooper said this approach to innovation began with the new brewery at Regency Park in 2001.

"The new brewery has enabled us to expand from South Australia to become Australia's largest independent brewer to nearly 5% of the national beer market," he said.

"During the past 25 years, we have automated and delivered substantial productivity improvements estimated to exceed 500pc in terms of the number of cartons produced per operator.

"We have also innovated with new products, such as our recently released XPA, Session Ale and Coopers Dry which are exemplars of their particular beer styles.

"Our recent move to package ales in cans is another example of innovation and helping meet consumer demand."

Dr Cooper said the recent development of a $68m malting plant at the Regency Park brewery site had further underlined Coopers' commitment to excellence.

"The maltings has given Coopers full control of one of its key ingredients, malt, and is helping our team of world class brewers to experiment and innovate," he said.

In March this year, the maltings was named equal best maltster in the world at an international award presentation in Poland.

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