C&C to invest big in new Irish craft brewery
Drinks group C&C is to invest in a new brewery in Dublin to increase capacity for its Five Lamps craft beer label.
The maker of Bulmers/Magners cider and Tennent’s lager is also in talks to take on a significant level of outsourcing duties for other drinks companies on the back of Brexit.
Earlier this year, chief executive Stephen Glancey said C&C would be investing €1m to €2m to boost cider production at its Clonmel, Co Tipperary, plant and was looking at long-term investment at its Five Lamps craft beer brewery in Dublin.
However, speaking yesterday, Mr Glancey said C&C will be making an investment in Five Lamps in the next three-to-four months which will see a move to a new brewing site away from its current north inner city base.
He was speaking on the back of a strong set of first- half figures, which saw 186% annualised revenue growth to €838.7m and 16% growth in operating profit to €58.4m for the six months to the end of August.
The revenue figure included a first contribution from Matthew Clark Bibendum, the leading independent drinks distributor to the UK pub sector, which C&C bought earlier this year. Stripping that business out, C&C’s core first-half revenues were up by 6.4% at just over €309m.
Mr Glancey also said management is confident of seeing a return to full-year profit growth in its current financial year, which runs to the end of February. Last year, the company saw operating profits fall 7% and revenues decline 5%.
“We have momentum in our core business and good cash generation. We’re pretty confident on our full-year numbers,” Mr Glancey said, saying that a good Christmas performance by Matthew Clark Bibendum should position C&C well for long-term growth.
Sales of Five Lamps beer increased 50% in the first half. C&C’s Irish revenues rose 6.6%, with Bulmers sales volumes up by over 5%. UK net revenues were ahead by over 8%, with operating profit growth there touching 10%.
Despite intense competition from rivals, with Heineken eating into the cider market and Diageo upping its lager production, Mr Glancey said that despite brand and marketing investment from others, “when the sun shines, people drink Bulmers”.
Regarding its Brexit plans, C&C intends to manufacture cider in Ireland and shift enough stock to the UK to remove transport, logistics and red tape worries for at least two years in the case of a hard Brexit. Mr Glancey also said that C&C is hopeful of agreeing deals to package EU-bound wine for South American, South African and Australian labels, post-Brexit, in the next six months.
He also said the group is in talks with drinks groups in continental Europe to manufacture products for them at its Glasgow brewery after the UK leaves the EU.
Mr Glancey said mainland Europe-based manufacturers have approached C&C on the matter and that meaningful discussions have taken place.
C&C shares are up over 23% in the past year.
They were up just over 1% yesterday.
