BrewDog continued to grow sales but failed to turn a profit in 2023, according to its latest financial results.
Net revenues for the period ended 31 December 2023 climbed 12% to £280.9m, driven by “market-leading performance in beer and continued strong performance” across the group’s bar division, BrewDog said.
Underlying trading EBITDA losses at the Punk IPA brewer improved from £12.8m in 2022 to £2.5m in 2023, but pre-tax losses soared to £59m, up from £25m in 2022.
BrewDog attributed the increase to “one-off impairment costs related to historic acquisitions and restructuring”.
The impairments are understood to relate to Hawkes Cider and the Draft House pub group, both acquired by BrewDog in 2018.
BrewDog closed its Hawkes Cider taproom and production facility in November 2023, citing “rampant” inflation. The brand’s products are now produced out of its main brewery in Ellon, Aberdeenshire.
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Posting on LinkedIn, BrewDog founder James Watt – who stepped down as CEO earlier this year – said it “came very close to returning to profitability”.
Describing ongoing losses as “frustrating”, Watt added: “We’re right on the edge of a return to our strong track record of positive EBITDA trading.”
James Arrow, who replaced Watt at the helm of BrewDog in May, added: “Our trading losses reduced significantly in 2023, reflecting the significant changes we have made to address inefficiencies in the way we operate, and this will continue to be a priority as our business continues to evolve and return to sustainable, profitable growth in 2024.”
Elsewhere, BrewDog said annual volumes surpassed one million hectolitres (hl) for the first time in 2023, with the brewer producing a record 100,000hl in the month of June.
Flagship bars BrewDog Waterloo and BrewDog Las Vegas both brought in excess of £10m in sales, meanwhile, while global bar sales increased by 12.3%.
Gross sales in the US, Germany and Australia, meanwhile, climbed by 20%, 20% and 31% respectively.
Updating on its performance in the first six months of this year, BrewDog said it had recorded H1 2024 revenues of £137.5m, flat year on year. It was, “on track” to return to profitability this year, however, it said.
Grocery revenues, meanwhile, were up 2% to £33.3m, on volumes that have swelled by 10% year on year.
The results came as Watt this week hit out at suggestions chancellor Rachel Reeves could be about to raise capital gains tax in the upcoming budget.
Watt, who could face a hefty capital gains tax bill in the event of a BrewDog sale or IPO, said a large increase in the rate of the levy would “destroy entrepreneurial spirit in the UK and in turn severely damage our economy”.
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