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BenRiach toasts a doubling of profits

THE BenRiach Distillery Company has seen profits more than double as co-owner Billy Walker hailed the stellar performance of single malt whisky in global markets.

ENTERPRISING SPIRIT: BenRiach co-owner Billy Walker is toasting a 116 per cent rise in profits to £8.9 million.

The Newbridge-based company, which owns the BenRiach, GlenDronach and Glenglassaugh malts and distilleries, marked its tenth anniversary by hiking pre-tax profits by 116 per cent to £8.9 million in 2013.

Turnover rose by a robust 39.4 per cent to £34.5 million amid "unprecedented demand" for its single malts in Europe, North America, Asia and in the UK.

So far, the distiller has not faced any difficulties in China, where anti-extravagance measures have dented results at drinks giants Diageo, Pernod Ricard and Remy Cointreau.

Mr Walker, an organic chemist who began his whisky career with Ballantine's, going on to join Inver House Distillers in the mid-1970s, said BenRiach's malts had been the "real driver" over the period.

Highland malt GlenDronach had led the sales charge for its brands during the year, followed by Speyside's BenRiach.

But Mr Walker said Glenglassaugh had been the "big surprise", noting that "in relative terms" the Aberdeenshire malt had "performed pretty well" since its acquisition by BenRiach in March last year.

Mr Walker said: "The business model we follow is quite important.

"We don't necessarily drive for volume, we drive for value.

"We engage with like-minded importer/distributors. We have no great enthusiasm to be involved with the multiple retailers - we're quite loyal to the private independent retailer sector.

"But the reality is there is an appetite for single malt. Generally single malt is very much in its stellar performance at the moment."

Mr Walker said the market for top-end malts, including BenRiach's brands, had held up well for his company during the prolonged economic downturn.

Taiwan is its biggest export destination, but with strength in mature markets such as Europe and North America, as well as the emerging areas of Asia and Africa, he insisted BenRiach enjoys a "good global spread - we're not exposed to any one particular territory".

On the effects of austerity in China, Mr Walker added: "We haven't seen it yet. That's not to say it might not happen in the future, but we haven't seen it. We operate in a much more boutique way than the big boys.

"But I have to say the reality is the big boys are helpful to us because they do actually open markets and create opportunities for everybody."

Mr Walker, a master blender, was part of the management team which bought out East Kilbride's Burn Stewart Distillers in 1988.

He began his current business with the acquisition of the then mothballed BenRiach Distillery from Pernod Ricard in 2004, with South African partners Geoff Bell and Wayne Kieswetter.

Both Mr Bell and Mr Kieswetter remain on board and are central to the firm's attempts to grow sales in Africa.

The BenRiach Distillery Company delivered a maiden profit of £241,716, on turnover of £4.62 million, when it reported its first full-year results in 2005.

In the period since, it has acquired Aberdeenshire's GlenDronach Dis-tillery in 2008 and set up a bottling plant at Newbridge in 2010. Glenglassaugh was added last year.

During that time, it has seen its headcount rise from 12 to 120 staff across its four sites.

Mr Walker said the company would consider making further acquisitions.

Asked if the major distillers' quest to expand production would impede its ability to do deals, he said: "I think the general environment now is more difficult to make acquisitions. We would not be averse to doing something, but it would have to sit into our business model and it would have to sensibly priced.

"And therein lies the rub, because the kind of multiples for single malt distilleries are now very high."

He added: "We would aspire to one or two things, but I think they are way outside of our reach at the moment.

"And I'm not sure that anybody has any great appetite to sell at the moment."

Looking ahead, Mr Walker noted that the current financial period was shaping up to be another "spectacular year" for BenRiach, explaining that the "same drivers" are continuing to underpin growth.

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