PROFITS fell 60% at Whyte and Mackay in the latest financial year despite the boom in demand for whisky overseas, but the company said the flamboyant Indian businessman who owns the firm has no plans to sell it.

A spokesman for Whyte and Mackay said Vijay Mallya, who also owns the cash-strapped Kingfisher Airlines, believes the company can prosper with a focus on branded drinks and exports.

"He has no plans to sell the company and remains committed to growing our brands and the company internationally," the spokesman told The Herald.

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The vote of confidence in Glasgow-based Whyte and Mackay followed the publication of accounts which indicated the company suffered a downturn in trading in the year to March.

The company made a pre-tax profit of £12.4 million, compared with £31.7m in the preceding year. Turnover fell 20%, to £169m from £211m.

The fall in sales came during a period when the Scotch whisky industry has been thriving on the back of booming exports.

The Scotch Whisky Association reported that global shipments of Scotch increased 23% annually in the first nine months of this year, to a record £3 billion. In 2010 shipments increased by 10% to £3.5bn.

Against that backdrop, some might wonder if the result achieved by Whyte and Mackay will make Mr Mallya question the value of the £595m paid by his United Breweries for the business in 2007.

There has been speculation that Mr Mallya might sell the firm to raise funds for Kingfisher Airlines.

However, Whyte and Mackay said the fall in profits was an understandable result of a change in strategy that will deliver big benefits. This has involved trying to reduce Whyte and Mackay's involvement in the market to supply spirit in bulk and producing own label spirits to focus on branded products. Its brands include the eponymous blended Scotch, and Dalmore and Jura single malts.

In a statement, the company's finance director Hemanth Menon said: "[Whyte and Mackay] has over the last 18 months consciously reduced its bulk business and has invested behind the international infrastructure necessary to achieve the 'Brands and International' mantra."

He claimed the shift in strategy enables the business to "sustain superior growth in the long-term". However, he added: "This obviously has an impact on the short-term profit and turnover – this is also reflected in the 2011 numbers."

Mr Menon claimed that the company has the support of all its stakeholders. "A testimony to this was our ability to refinance the entire debt at favourable terms," he said.

In the latest accounts, Whyte and Mackay said the £137m bank loan repayable at the financial year end was refinanced in July, with a three-year moratorium on the repayment of the principal.

Mr Menon said the results of the shift in strategy were evident in the rapid growth achieved by Dalmore and Jura recently.

Regarding the change of strategy, Alan Gray, author of the Scotch Whisky Industry Review at Sutherlands, said: "It does make sense taking the long-term view. There was never going to be a lot of growth if they continued to do what they did."

He added: "They have got very strong brands in Dalmore and Jura. They have got a good brand in Whyte & Mackay but it's in very tough marketplaces, especially the UK."