UK. Liqueur brand Drambuie has announced a solid +31% increase in operating profit on brand sales before interest and tax from £2.4 million to £3.2 million for the year ended 30 June.
The company attributes this to the driving of further costs out of the supply chain, which resulted in an increase in the gross profit margin on sales from 65.8% in 2007 to 68.1% this year.
The balance sheet remains strong, the company said. Cash at bank now stands at £9 million (up from £7.7 million last year), after paying out £1.4 million of dividends and non-executive directors’ fees to the shareholders.
Drambuie Chairman Richard Stone commented: “We are a highly focused, international brand marketing and distribution company with a clear strategy, underpinned by world-class distributor management and financial processes. Our key objective is to enhance brand equity and grow shareholder value.
“As a private company, we will continue to utilise our strong cashflow generation to invest even further in brand marketing; although such investment may adversely impact the profit and loss account in the short term, it should lead to enhanced brand equity and shareholder growth, which is the team’s key objective,” he added.
Drambuie CEO Phil Parnell said: “This is the second full year of implementation of the Drambuie Rejuvenation Strategy, which has the objective of profitably rebuilding long term growth for a brand which had suffered a steady erosion of its traditional consumer franchise for some 30 years.
“This strategy is intended to broaden Drambuie’s appeal beyond the conventional after-dinner liqueur-drinking occasion by introducing a younger generation of consumers to a more versatile product. As a result we have seen three years of stable volumes across the brand and this is the first significant step in the long term rebuilding of a new consumer franchise to stimulate growth.”
The linchpin of this international marketing programme is The “˜Drambuie Pursuit’, an adrenalin-charged race across the Highlands of Scotland, inspired by Bonnie Prince Charlie’s flight from Culloden in 1746.
In its third year, teams from ten of Drambuie’s key markets competed in the Drambuie Pursuit, generating extensive media coverage reaching its target audiences in the core markets of the UK, US and Canada plus Brazil, Germany, Russia, Scandinavia and Turkey.
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