Canada, ON: Brick Brewing Co. reports Q1 results with EBITDA falling short of expectations
Brick Brewing Co. Limited, Ontario’s largest Canadian-owned brewery, released on May 31 financial results for the first quarter which ended April 29, 2018.
Brick reported EBITDA of C$1.13 million on net revenue of C$10.6 million, excluding the impact of one-time adjustments. EBITDA was negatively impacted by C$0.11 million in one-time warehousing and shunting costs to build inventory related to the can line upgrade and net revenue and EBITDA were negatively impacted by C$3.59 million and C$2.2 million, respectively, due to the mandated transition by TBS to consignment-based inventory.
George Croft, Brick’s President and Chief Executive Officer commented, “Our EBITDA results in the first quarter fell short of our expectations. The overall beer category experienced softness driven by an unseasonably cold and wet spring which drove the industry volume lower by 6%. The beer category also experienced headwinds from increased government taxes and TBS distribution rates, driving a 2% decrease in net revenue during the quarter. Brick’s lead brands performed better than the norm, Waterloo family grew 6%, Laker family declined 3%, while our summer-themed brands LandShark and Margaritaville were especially vulnerable to the prolonged winter and decreased by 17%.”
“April 2018 saw the completion of the installation of our can line upgrade project – both on time and on budget.” commented Russell Tabata, Brick’s Chief Operating Officer. “The ramp up of the new can equipment has exceeded our early expectations and, as of the end of the quarter, the new equipment is operating consistently at or above our targeted rates which has effectively doubled the line’s capacity. We expect our new can line capability to be the cornerstone of our future success and business growth.”
Croft added, “We do not see these results as indicative of our full year performance. We are now entering our peak summer selling period and we are working hard to regain our momentum. With the launch of our new Laker packaging design, our Landshark promotions, our Waterloo seasonal offerings and the exciting Chudleigh’s cider launch, we are positioned well for success. The positive start up of the can line will offer new opportunities for both our owner brands as well as for our co-packing customers. We are now well positioned to compete in the competitive Canadian beer market and to serve our customers for the long term.”
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