CANADA: Big Rock sees H1 income dip as premiumisation takes hold
Big Rock Brewery has posted a sharp slide in net income for the first half of this year, on the back of flat sales.
The Canada-based brewer said on Friday (10 August) that net income for the six-month period dropped to C$2.64m (US$2.5m) from C$3.8m in the corresponding period a year earlier. Sales in the half to the end of June held steady at C$18.82m compared to C$18.87m.
For the quarter to the end of June, net income fell a worrying 34% year-on-year to C$1.8m. Sales rose slightly, however, by 2% to C$10.7m.
The brewer highlighted a one-time corporate income tax rate adjustment in the second quarter last year, however, which resulted in a "tax-win" of C$533,000 in future income tax recovery.
Big Rock also spent the second quarter repositioning its craft beers as premium brands by reducing its promotional item giveaways. "As anticipated," the company said, "volumes decreased compared to the same quarter last year. While volumes decreased, sales revenue increased due to the positive change in product mix between craft and value beer categories."
Moving forward, the brewer said it will continue to "strategically and aggressively reinvest marketing dollars", having seen cost of sales lift to C$4.2m in the second quarter, compared to C$3.9m a year earlier.
Sectors: Beer & cider
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