By Scott Wright
THE Edinburgh-based company owner of the prestigious Scotch Malt Whisky Society (SMWS) has flagged continuing growth of revenue and membership in the year to April.
But the Artisanal Spirits Company warned that “comparative performance figures will get tougher in the second half”, adding that the zero tolerance approach to Covid currently being pursued by the authorities in China may present “additional challenges” in the market in the current quarter.
In a statement to the stock market issued ahead of its annual meeting yesterday, Artisanal said that the “positive momentum” reported by the company when it unveiled its preliminary results for the 12 months to December 31 has continued into the current year.
Revenue growth has remained above 30 per cent in the period to April, said the company, which also reported that membership growth – “a leading indicator of future revenue growth” was “now slightly ahead of management expectations”.
Artisanal, which floated on the stock market last year, said membership was up more than six per cent in the period and 25% year-on-year at more than 35,000.
The SMWS, which was established in 1983, provides its members with the opportunity to buy whisky from more than 100 distilleries in 20 countries, and access to events at its network of venues.
In March, parent company Artisanal reported that global membership of the Society had grown by 18% to 33,000 in the year ended December 31. Slower growth in Europe was offset by exceptional expansion of new members in China, while in the UK there were 20% more members at 16,400 by year-end.
By the end of February, overall membership had increased to 34,200.
Artisanal highlighted progress yesterday on the development of its new logistics facility in Uddingston. Cask racking has been largely installed and main contractors have been appointed, with the work due to begin this month. “We continue to anticipate that the site will become fully operational in the second half of the year and be a contributor to improving the already-strong margins of the business,” the company said in a statement.
Artisanal said current consensus market expectations are for the company to achieve revenues of £21.6m for the year ending December 31, 2022. Last year, revenue grew by 21% from £18.2m in 2021 as the company benefited from the re-opening of venues following coronavirus restrictions.
Sales in the company’s UK venues, which are based in Leith, Edinburgh, Glasgow and London, were matching pre-Covid levels by the end of the year.
The company declared in yesterday’s AGM statement: “Year-on-year growth of over 30% in part reflects cycling over low Q1-21 sales in UK venues and Europe and we remain cognisant that comparative performance figures will get tougher in the second half of the year.
“Furthermore, the Chinese government’s zero tolerance approach to managing Covid-19 has presented additional challenges for our business in that territory in the current quarter.
“However, we continue to make encouraging progress against our strategy and the group remains on course to deliver strong revenue growth for the full year in line with current consensus market expectations.”
All resolutions tabled at the company’s annual meeting yesterday were passed by shareholders.
Artisanal raised gross proceeds of £26m from its initial public offering in June last year, and used the funds to buy stock, launch spirits brand JG Thomson, increase its stakes in joint ventures in China and Japan, and invest in a new logistics warehouse.
The Uddingston site will be used for maturing stock, bottling and order fulfilment.
Shares closed down 3.2% at 75p.
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