Theakstons, the North Yorkshire brewer, has reported a 4% fall in turnover to £9.6m for the year ending December 2013 after agreeing long-term commercial and financial arrangement with Heineken UK in what it has called a “momentous” financial year.

The agreement has seen a continuation of Theakston’s strategic alignment with Heineken UK as the exclusive distributor for Theakston for the next five years for branded cask, keg and bottled beers to on- and off-trade customers in the UK. This accounts for Theakston’s entire UK trade turnover besides the Masham brewery and visitor centre.

The company said because of the arrangement with Heineken its business model “has been significantly reshaped” which has altered its profit and loss accounts from November 2013.

Turnover fell to £9.6m from £10.4m in 2012 for the year to end December 2013 which the company said is a result of the new contract terms commencing in November 2013.

Theakston said: “The growth in turnover in 2013 on a like for like basis would have been 4% (assuming the original long term agreements had continued throughout the whole of 2013) rather than the 8% reduction.”

Profit before tax was £2.04m, up from £1.9m the previous year.

In response to the cuts in beer duty Theakston said it “warmly welcomes the abolition of the beer excise duty escalator and subsequent cuts in beer duty as announced in the 2013 and 2014 budgets, but continues to believe that the overall level of beer excise duty is excessively punitive.”

The company said it continues to support the Progressive Beer Duty legislation but said it “strongly believes that it should be the subject of a formal review in order to create a fair and sustainable taxation system within which brewers of all sizes are given the opportunity to thrive.”

It added that the fragmentation of brand availability puts pressure on trading margins within the take home and on-trade markets.

The brewer said it is focusing its future investment on developing and brewing beers while strengthening the brand equity after agreeing commercial and financial arrangement with Heineken UK.

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