EXCLUSIVE - UK: Whyte & Mackay quells cash-flow claims
just-drinks spoke exclusively to Whyte & Mackay's finance director, Hemanth Menon, earlier today
Whyte & Mackay has moved to clarify reports that it is suffering from cash-flow issues, having brought forward scheduled maintenance closures at its five Scotch whisky distilleries.
A report by the Press and Journal in Scotland last week claimed that the company, which is owned by India's United Spirits, has been struggling with cash flow. The problem has resulted in Whyte & Mackay bringing the annual scheduled maintenance periods at its five facilities forward to this month, the newspaper said
However, speaking exclusively to just-drinks today (15 June), company finance director Hemanth Menon moved to calm the reports. “We have brought forward the maintenance at our five distilleries from July and August,” Menon confirmed.
“However, our stock model has changed. Whyte & Mackay is now brand-led, not bulk-led. Also, as things stand, the cost of cereal and gas is at a peak. The laying down of stock is also more costly than usual. It is only prudent, then, to maximise and monetise this opportunity, and bring the planned distillery closures forward.”
Menon also said that the company will return to normal production in July or August.
“We have fundamentally robust performance parameters that we are working on,” he added.
Turning to the cost management claims, Menon said: “We have points of cash flow management challenges, which we are optimally managing, along with our partners. All our suppliers have a long-standing association with Whyte & Mackay and are strong partners in our progress. We continue to work with all our suppliers.”
United Spirits' parent company, The UB Group, is widely believed to be struggling as its Kingfisher Airlines division continues to drag on group performance. “All of UB Group's units are independent,” said Menon. “Each has its own board of governance. We don't do any form of co-funding. What is happening in the other companies has nothing to do with United Spirits or Whyte & Mackay.”
Sources in Scotland have told just-drinks that Whyte & Mackay is currently dealing with around GBP8m (US$12.5m) in unpaid bills. When asked about this, Menon said: “We have supplier payments which come up regularly. I don't know what the exact number is today, but our top line is more than GBP220m, so if we owe creditors around GBP8m, that's regular business in capital management.”
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