Bottles of The Famous Grouse flew off the shelves last year with “significant” sales growth making the Perth label the most popular Scotch brand in the UK by both volume and value.
Owner Edrington used its annual results announcement to reveal that the blend had also overtaken Grants and Dewars to become the fourth largest standard Scotch brand in the world, following a period in which growth topped 15% in sub-Saharan Africa.
But the company was forced into a major write-down of more than a quarter of a billion pounds on its Brugal golden rum brand after admitting it expects poorer receipts than previously anticipated.
It bought a majority stake in the Dominican Republic brand its first foray into spirits other than whisky in early 2008 for £313 million, the second-biggest acquisition ever undertaken by the group.
Yesterday, its annual report revealed the board had downgraded Brugal’s prospects in view of a continuing hangover from turmoil in the eurozone.
Edrington had previously foreseen considerable growth potential for the label, particularly in Spain, Italy, Russia and the USA.
However, American sales did increase by 22% in the year with the rum proving particularly popular in New York, Boston and Chicago.
The charity-owned group, which now boasts that 91% of its sales revenue comes from outside the UK, recently announced the establishment of new direct operations in the USA, South East Asia and the Middle East, in a “step-change” investment expected to cost up to £15m.
Chief executive Ian Curle said the figures announced amounted to “another record year of trading”, and thanked retiring chairman Sir Ian Good for turning the group into a premium international spirits company.
“In the face of challenging economic conditions in Southern Europe, our overall strength in both established and emerging markets has resulted in an increase in our turnover, profit and dividend,” he said.
“Our financial strength has underpinned significant brand share growth in key markets and this will be further strengthened by the establishment and expansion of distribution activities in the US, South East Asia, the Middle East and Africa, allowing us to bring our premium brands to ever more consumers.”
Overall, Edrington said its turnover had risen by 6% to £591.3m during the 12 months to the beginning of April, with pre-exceptional pre-tax profits shooting up by 13% to £168.6m.
Including the impact of the Brugal write-down, it posted a pre-tax loss of £106.2m. Nonetheless, shareholders’ dividends will increase by 13% to 34 pence per share.
Edrington employs more than 2,200 people worldwide including around 100 people in commercial, finance and sales teams at West Kinfauns, and a further 25 at the Glenturret distillery and Famous Grouse Experience by Crieff.
Malt from Glenturret, reckoned to be Scotland’s oldest active distillery, is still used in The Famous Grouse, which was first created by Perth’s Matthew Gloag & Son in 1896.
The label subsequently passed to Highland Distillers in 1970, before that group was bought by Edrington in 1999.
The group’s other well-known brands also continue to prosper, with James Bond favourite The Macallan becoming the number two malt label after growing its worldwide sale by more the 40% during the last five years.
Highland Park’s profitability grew by a fifth in the year, while Cutty Sark gained market share in Spain and increased sales in the USA for the first time in 23 years.
The report also revealed that Edrington’s owner, The Robertson Trust, donated £15.3m to a variety of charitable causes last year.
Its highest paid director, understood to be Mr Curle, received a remuneration package totalling £861,000, including an incentive plan award, pension contributions and employee share scheme benefits, as well as £433,000 invested payments awarded in 2010 under a long-term incentive plan.