Gage Roads jumps 18pc as stadium swaps boring brews for hipster beers
Health & Biotech
Health & Biotech
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Millennial tastes in beer is changing stadium liquor line-ups, with Perth Stadium the latest to go peak hipster and swap boring brews for craft drops.
VenusLive has given Craft brewer Gage Roads Brewing (ASX:GRB) a five-year contract to supply Perth Stadium and the yet-to-open Stadium Park with beer and cider from next year.
The news pushed Gage shares up 1.c to 7.2c yesterday, with 20 million shares changing hands.
Under the deal, Gage gets exclusivity in exchange for paying an annual fee, volume rebates and sponsorship fees to VenuesLive.
The company did not disclose the size of the contract.
Gage was not able to forecast the impact on revenue, because volumes sold would be contingent on estimated attendance figures and number of events.
“The supply rights to Perth Stadium will provide Gage Roads with unprecedented brand and product exposure that we expect will accelerate sales growth momentum through our existing channels to market,” managing director John Hoedemaker said.
Craft brewers have been the undisputed winners of the Australian beer market for years, but it’s starting to become a crowded market.
Beer consumption in Australia has been dropping since the 1970s. But demand for craft beers and ciders is growing at about 10 per cent a year according to Deloitte.
The craft market is now worth $740 million.
There were 380 craft breweries in the country in 2016, up from 30 in 2006, according to a study by Essential Economics for the Independent Brewers Association.
But independent brewing sector accounted for only 3 per cent of total beer production in Australia, so the big rise in volumes were coming off a low base.
Indeed, in August Lion Nathan released a new ‘everyman’ beer called Iron Jack, with brand director Jack Mesley saying there was room in Australia for a mid-strength beer with low bitterness that wasn’t overly flavourful.
The market is still dominated by giants Lion Nathan, Coopers Brewery and Carlton & United Brewers.