Profits at family-owned Gordon & MacPhail fell by a quarter last year amid a double-digit jump in costs as the whisky industry grappled with ongoing supply chain disruptions.
The Elgin-based company enjoyed a healthy increase in sales of its Benromach range of whiskies, which it acquired in 1993. This supported a 10% increase in group revenues during the year to the end of February, which rose to £37.4 million.
However, a 54% increase in distribution costs ate into the bottom line, as did a 27% jump in the cost of sales and a 19% rise in administration expenses. Overall pre-tax profits fell to £10.4m from £13.9m previously.
Despite supply chain challenges and disruptions from the Covid pandemic, the business pressed ahead with the construction of its second distillery. Distilling at the £20m Cairn facility on the banks of the River Spey began in May, and was opened to visitors in October.
“We continue to execute our long-standing principles of investing in whisky stocks, our infrastructure and the people who work for the business,” managing director Ewen Mackintosh said. “And we are particularly proud of the work of so many people and organisations in the building and recent opening of The Cairn Distillery – a major milestone in the 127-year history of the company.
“As our newest asset, The Cairn offers additional distillation capacity and will act as a key addition to the long-term sustainability of our business.”
Sales value and volumes of Benromach rose by 15% and 14% respectively amid increasing demand from both traditional and emerging markets. Produced on the edge of Forres in Moray, the brand has also benefitted from being “repackaged and repositioned” within the market.
Since its foundation in 1895 as a grocery in Speyside, Gordon & MacPhail has sent casks to distilleries throughout Scotland to be filled with new-make spirit that were then left to mature either at the distillery or in its bonded warehouses in Elgin and Forres.
The company is renowned for its blending skills, and has a portfolio including some of the world’s rarest single malts. The year to February included the release of what was then the world’s oldest single malt Scotch – an 80-year-old – that bolstered performance.
READ MORE: Elgin’s Gordon & MacPhail hails US breakthrough as profits rise
The wholesale business serves customers throughout the UK selling Benromach, the company’s Red Door gin and Gordon & MacPhail whiskies to the on and off-trade. The business also exclusively represents a number of “distributor” brands and stocks premium whiskies and spirits.
“The year ended 28 February 2022 delivered a strong performance, particularly in international markets, which has seen a significant up lift in sales with our brands continuing to have strong appeal,” Mr Mackintosh said.
International sales rose to £24.4m against £13.8m the previous year as demand remained strong for premium aged single malts. The UK accounted for £13m of sales.
The company, which files its results under the name of Speymalt Whisky Distributors, continues to operate the original retail shop in Elgin which is regarded as the “spiritual home” of the business. It stocks a large selection of single malts and is a tourist destination for whisky aficionados from around the world.
Mr Mackintosh added: “The success of our business is predicated on the contribution and commitment of so many people and businesses who support us not least of all the dedication of our tremendous workforce. On behalf of Gordon & MacPhail I’d like to thank my colleagues, our customers, suppliers and partners for their ongoing commitment and support.”
Why are you making commenting on The Herald only available to subscribers?
It should have been a safe space for informed debate, somewhere for readers to discuss issues around the biggest stories of the day, but all too often the below the line comments on most websites have become bogged down by off-topic discussions and abuse.
heraldscotland.com is tackling this problem by allowing only subscribers to comment.
We are doing this to improve the experience for our loyal readers and we believe it will reduce the ability of trolls and troublemakers, who occasionally find their way onto our site, to abuse our journalists and readers. We also hope it will help the comments section fulfil its promise as a part of Scotland's conversation with itself.
We are lucky at The Herald. We are read by an informed, educated readership who can add their knowledge and insights to our stories.
That is invaluable.
We are making the subscriber-only change to support our valued readers, who tell us they don't want the site cluttered up with irrelevant comments, untruths and abuse.
In the past, the journalist’s job was to collect and distribute information to the audience. Technology means that readers can shape a discussion. We look forward to hearing from you on heraldscotland.com
Comments & Moderation
Readers’ comments: You are personally liable for the content of any comments you upload to this website, so please act responsibly. We do not pre-moderate or monitor readers’ comments appearing on our websites, but we do post-moderate in response to complaints we receive or otherwise when a potential problem comes to our attention. You can make a complaint by using the ‘report this post’ link . We may then apply our discretion under the user terms to amend or delete comments.
Post moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours.
Read the rules here