Arran Brewery, the Scottish brewer and pub operator has reported like for like sales up 11% for 2013-14 as it prepares to open its Loch Earn brewery, hotel and visitor centre at St Fillians later this year and abandons its distillery in Falkirk.
The distillery project at Rosebank in Falkirk has been abandoned due to excessive planning and unforeseen circumstances causing the project to be abandoned after cutting significantly into the company’s profits.
The company had to reject more than £500,000 worth of grant support from Historic Scotland as well as potential lottery funding and £2m in prior arranged investor funding for the project.
At its new development at St Fillians, poor weather prevented the brewery and hotel being completed and opened last year which has lead to the company carrying significant overheads.
“The move in to the US and overseas markets has been substantially more costly and taken more time than was initially thought but significant progress has been made and the benefits should start to be felt in 2015/16” the Company reported.
With more investment required at Dreghorn there will be a second round of crowd funding during the year. Shares will initially be offered to existing shareholders then to the wider public around Easter time.
The brewery has agreed a conditional loan with the Bank of Scotland for £300,000 to complete phase two of the Loch Earn Brewery project.
Gerald Michaluk managing director said “We are strategically well set to benefit from all this investment in the coming years especially once our own bottling line and warehouse comes on stream later in 2015. We now own a 5+ acre site and significant infrastructure at Dreghorn and this will become the base for our move into the Sake business and allow us to bottle our beer in-house on the mainland.
He said the brewery is continuing to grow both in the UK and internationally: “We now have the brewing staff trained and are therefore confident that we can move quickly into production when the new facilities are open later in the year and significantly increase sales as well as reduce costs by moving from contract bottling on the mainland to in-house bottling at Arran View Brewery, Dreghorn. The space created on the Island by discontinuing our bottling there will be used to increase significantly production capacity.
“We have strengthened our sales team both in the UK and now employ staff in the US and mainland Europe. Our plans have stretched our staff and we will be looking to recruit a Finance Director to the team, as well as fill a number of other posts in the coming months. This will be coupled with strengthen our board by appointing three additional non-executive directors, one of which will be elected from within our shareholder pool created from the first round of crowd funding”.
