Craft brand accelerator Mighty Craft has released its result for the first half of its financial year with strong revenue growth and improving profit trajectory among key highlights.
Revenue for the half totalled $25.9m, up 132 per cent on the prior corresponding period (PCP), while the bottles of spirits sold increased 44 per cent to 148,740 and total litres of beer and cider sold increased by 23 per cent to 2.2 million.
The company also completed the successful integration of the Adelaide Hills Group of companies, including bringing the sales and distribution of AHG products back in-house, upgraded the Kangaroo Island Distillery and launched Better Beer in partnership with Torquay Bev Co and the Inspired Unemployed.
Mighty Craft’s Managing Director Mark Haysman said: “The first half has been both challenging and incredibly exciting for the business. Managing through lockdowns, COVID, venue staffing issues and now unpredictable consumer demand has been tough and I am incredibly proud of the resilience of our people and the drive to keep our customers and each other safe.
“I am sure we will look back on this period in a few years as one that was pivotal in setting the business up for future success. We have achieved an incredible amount in tough circumstances. The growth is strong and what I’m particularly pleased about is the improving bottom line. In Q2 FY22 we delivered our first EBITDA profit which is a great start.
“We now need to consolidate and keep delivering against our strategy. There are a number exciting growth opportunities ahead of us. These include but are not limited to the acceleration of the Adelaide Hills Group of companies, building our Whisky bank to 300,000 litres by year end, expansion of the recently re-launched Kangaroo Island Spirits brand and of course capitalising on the incredible success of Better Beer.
“We have what we regard as the best portfolio of premium local craft brands in the country covering Beer, Cider, Spirits and RTDs and the growth we are seeing is only the beginning.”
The company also reported that from a wholesale perspective growth was led by the spirits and RTD category, which saw 54 per cent growth with strong performances from Seven Seasons (205.3 per cent growth) and Kangaroo Island Spirits (53.4 per cent growth).
From a beer and cider perspective, overall growth was 21.9 per cent driven by strong growth of Better Beer ($1.8m of sales from a November 2021 launch) and Jetty Road (22.4 per cent growth) despite significant disruptions to on premise sales through Covid.
Mighty Craft also said that its sales and distribution platform is designed for scale and that the second quarter of the half was the first time that the business delivered the required scale to cover fixed costs and deliver an EBITDA profit.
The company said that going forward it is critical that the quarterly revenue is of sufficient scale to cover the costs of the platform, which it estimates is between $16m – $18m of sales per quarter with the right mix of retail, wholesale spirits and wholesale beer and cider.