Australian craft beverage accelerator Mighty Craft has delivered its first profits since listing on the Australia Stock Exchange in December 2019, helped largely by Better Beer achieving record sales.
Mighty Craft reported unaudited group revenue of $31.2m in its second quarter results, up 91 per cent on the prior corresponding period (PCP), with cash receipts of $33.1m, up 87 per cent. In that result was 3.2 million litres of Better Beer sales, up an incredible 687 per cent on the pcp. Better Beer has now achieved in excess of $50m in retail sales value in the last 12 months.
Speaking about the result, Mighty Craft’s Managing Director and CEO, Mark Haysman said: “Q2 FY23 was a record quarter for the business from both a sales and operating cash perspective.
“We delivered the first positive operating cash result since listing in December 2019 – a significant milestone, reflecting increasing scale across the business and incredibly strong performance of Better Beer.
“We believe Better Beer is a unique asset of significant value, capable of competing with the largest beer brands across Australia and New Zealand. The upside potential of Better Beer is incredibly exciting for the business, an opportunity we’re aggressively pursuing.
“Our focus spirit brands are also performing very well. Likewise, we’re confident there exists significant opportunity over coming years to continue to unlock value for locally manufactured spirit brands.
“Our outlook for Q3 FY23 is strong, and we remain committed to balancing revenue growth with profit / cash delivery, while simplifying the business through our program of divestments.”
The Company’s wholesale channel also contributed a record quarterly result in Q2 FY23, delivering $25.1m in revenue (up 93 per cent versus pcp). The result was also 46 per cent higher than the previous record observed during Q4 FY22 of $17.1m. As well as Better Beer, other Key growth drivers included 78 Degrees (+35 per cent) and Kangaroo Island Spirits (+34 per cent).
Mighty Craft has continued to invest in whisky stocks during the quarter, although as the company has focused on cashflow management, this is at a reduced rate. Whisky under maturation during the quarter increased by 27,000 litres to over 400,000 litres, primarily a result of focused investment into both 78 Degrees and Kangaroo Island Spirits.
The company also provided an update on its investment in Ballistic Beer, which has been placed into voluntary administration.
Mighty Craft said: “Ballistic has appointed an administrator, who will recommend a course of action that is in the best interests of creditors. Ballistic is a minority investment for Mighty Craft, which owns 10 per cent of the company. The carrying value of the Ballistic investment on the Company’s balance sheet is $2.4m.”