Broo Limited has detailed massive wholesale sales growth helped by upgrades to its Mildura Brewery according to a market update to the ASX.

The upgrades became operational in September last year and that has helped the company to increase its domestic sales and increase distribution. Broo products are now available in Queensland through Australian Liquor Marketers (ALM), with further states to follow.

In its market update Broo said: “The first quarter to the final quarter of 2017 achieved a wholesale sales increase of 407 per cent.”

The update also detailed the brewer’s success in China following a seven-year distribution agreement being signed with Beijing Jihua Information Consultant at the end of last year.

The company said: “The agreement is binding on a ‘Take or Pay’ basis for 1.5 million litres of Broo Premium Lager beer products over the seven-year period with Jihua paying a fixed rate per litre. Based on the full seven-year term of the distribution arrangement, the aggregate distribution revenue generated for Broo is RMB602 million (approximately AUD $120m).

“This is an outstanding achievement for the company and the culmination of many years hard work.”

In addition to the updates on its performance in the Australian and Chinese markets Broo also detailed the performance of its Mildura Brewery pub and Sorrento brewhouse.

The brewery pub is continuing to see increases in patron numbers and sales volume, while the brewhouse has undergone extensive upgrades and refurbishments and stage one is due to open imminently.

Broo said: “This is an exciting project for the company given its locality to the birthplace of Broo Limited.”

The brewer also posted its report for the second quarter with the ASX, which detailed net cash from operating activities of -$1.7m. The $1.55m receipts from customers was turned into negative for the first half after significant product manufacturing and operating costs, staff costs and administration and corporate costs.

Broo also highlighted estimated cash outflows for the next quarter of $1.65m, but it added: “In the next quarter, the company is expecting to receive cash inflows that include payment of a $250,000 loan, and $750,000 in debt funding to be advanced from a director – related entity.

“In addition, the company will be receiving revenues in the next quarter from its beer product sales, contract brewing services for third parties and from trading operations at its hospitality venues including the Mildura Brewery pub and the Sorrento Brewhouse.”

Andy Young

Andy joined Intermedia as Editor of The Shout in 2015, writing news on a daily basis and also writing features for National Liquor News. Now Managing Editor of both The Shout and Bars and Clubs.

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