Good Drinks raises a toast on 597 per cent jump in profits, 3.6m jump in schooies
Food & Agriculture
Food & Agriculture
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Independent craft brewer Good Drinks (ASX:GDA) has continued its strong run, posting a 597 per cent increase in net profits to $3.6 million for the first half of FY21.
It came on the back of a 47 per cent increase in sales of $28.4 million for the half year.
Good Drinks is one of the country’s largest independent brewers, home to several well-known brands including Gage Roads Brew Co, Matso’s Broome Brewery, Atomic Beer Project, Alby, Hello Sunshine and San Miguel.
The earnings represent a record for the company, and have already surpassed the FY21 full year forecast.
Total sales volume and revenues grew by over 40%, and gross profit margins remained strong at 71% – which the company said is a validation of its strategy.
The stock price jumped by almost 8 per cent today to 8.3 cents.
The company said that significant investment undertaken in prior years, to build sales capability with a national footprint, has now come to fruition.
The core target for the company is to drive 10 million litres of incremental Good Drinks brands over the next five years (FY21 to FY25 inclusive). It sees the east coast as the next frontier, after developing a strong home market in Western Australia.
On-premise distributions in WA is growing at 30%, and on the east coast at 16% year to date. During the last six months, an additional 450 tap points has delivered an incremental 3.6m schooners.
In the off-premise channel, Good Drinks said it is positioned as the top independent supplier by value in the Australian craft beer segment:
In the second half, the company said it will further bolster the sales team with additional resources in both the west and east coast markets.
The San Miguel deal was struck last June, with Good Drinks becoming the exclusive importer and distributor of San Miguel PalePilsen, San Mig Lower Carb and their specialty high alcohol beer brand Red Horse throughout Australia.
Earlier this month, Good Drinks also secured a five-year extension on its contract with Optus Stadium in Perth, starting in January 2023. That deal would see the company providing its exclusive beer brands to the 60,000-seat stadium.
Good Drinks’ share price has been on solid form over the last 12 months, returning around 22 per cent. Since the March 2020 lows, the stock price has climbed 130%.
The company was previously called Gage Roads Brewing.