Wells & Young’s will be forced to cut jobs as a result of losing the rights to Corona Extra and Red Stripe lagers in the UK.
The beer venture between Charles Wells and Young & Co’s Brewery conceded in its half-year statement today (25 November) that the contract losses were “disappointing”. The group did not detail the number of jobs expected to go, but said: “This will have an impact on Wells & Young’s in terms of overhead costs, the size of the company and, regrettably, its people.”
The chairman of Wells and Young’s, Paul Wells, previously told just-drinks that job losses were possible following the change. Diageo will take back Red Stripe in early 2011, while Grupo Modelo has assigned its Corona Extra to Molson Coors after a 15-year partnership in the UK with Wells & Young’s.
The loss of the brands overshadowed a strong performance for Wells & Young’s in the 26 weeks to 27 September. Net sales rose by 1.5% and pre-tax profits rose by 18% on the same period of last year.
Young & Co, with owns 40% of Wells & Young’s, said that the loss of Corona and Red Stripe in early 2011 will not damage the beer venture’s profits for its full-year. “Beyond that, we are confident that Wells & Young’s management will respond in such a way so as to minimise any profit shortfall.”
The group owns Young’s and Charles Wells ale brands and also holds the UK licences for Kirin Ichiban and Estrella Damm.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Thank you!
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form
By GlobalDataYoung & Co, which counts pubs as its core business, today reported net sales up by 0.7% to GBP67.7m (US$106.7m) for the half-year. Net profits soared by 73% to GBP14.6m due to tax gains. Pre-tax profits increased by 4% to GBP11.9m.