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CANADA: Brick Brewing struggles continue in Q3

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Brick Brewing has continued its tough travails in the third quarter of this year.

The Canadian brewer, which saw its first half profits reverse into the red earlier this year, said yesterday (11 December) that net loss in the three months to the end of October came in at C$858,000 (US$848,720). This compares to a profit in the corresponding period a year earlier of C$40,000.

Sales in the quarter also slid, to C$7.5m from C$8.7m in Q3 2006.

Brick blamed the profit reverse on increased production taxes, one-time costs related to its recent strategic review and severance costs.

"We view these results as unfavourable but not unexpected," said Brick's founder and chairman, Jim Brickman. "The strategic review took longer than planned and proved to be both an expensive and distracting exercise for the company. However, we believe it was a necessary exercise to explore alternative opportunities that could maximise shareholder value.

"With the process now behind us, we can focus on streamlining operations that recognise the current realities in the marketplace while implementing strategies to grow our business."

Sales in volume terms in the quarter fell by 9% year-on-year, with volumes sold at The Beer Store, the industry's dominant Ontario distribution channel, declining by 15%. Volumes sold to LCBO (Liquor Control Board of Ontario) outlets, however, increased by 5%.

For the first nine months of 2007, net losses were running at C$1.5m compared to a profit of C1.1m a year earlier. Sales were down to C$24.0m from C$27.3m.

Last month, Brick confirmed that, following the business review, it had decided not to pursue a sale of the company. The decision prompted the resignation of company CEO Doug Berchtold a few days later.


Sectors: Beer & cider

Companies: Brick Brewing Co. Ltd

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