Edrington selling off brands to up focus on big names

Cutty Sark and Glenturret to be sold Group says it doesn’t expect job losses

By Spirits group Edrington – behind The Macallan and Famous Grouse names – has announced plans to sell two non-core brands as it unveiled a strong rise in sales last year.

The group is looking to dispose of its Cutty Sark rum and Glenturret whisky brands to be able to increase its focus on its key products, which also include Highland Park, The Glenrothes and Brugal Rum.

The news came as the Glasgow-based company announced core revenues rose 7 per cent to £706.7 million in the year to 31 March with pretax profits rising by 3 per cent to £194.7m.

Edrington said growth in sales had been down to heavy investment in its portfolio with spending of £125.7m, up 5 per cent on the previous year.

Chief executive Ian Curle said that the proposals to sell Cutty Sark and Glenturret “will enable greater focus and investment to support the long-term growth of the company’s premium portfolio”.

He said: “Premium spirits is the fastest growing area of the spirits market. Focusing our resources and investment on the brands best equipped to compete powerfully will help Edrington to capitalise on the long term prospects from premium spirits.”

The sale process will launch this summer and Edrington said it is not expected to involve any redundancies, with all 31 employees at The Glenturret in Crieff, Scotland’s oldest single malt scotch whisky distillery thought likely to transfer to a new owner. The Famous Grouse visitor centre which is based at the distillery will close.

Cutty Sark is blended and bottled at Edrington’s Great Western Road, Glasgow facility, accounting for around 10 per cent of volume output at the site. The firm said its intention is to offer the site’s services to a new owner but even if that is not possible it doesn’t expect any compulsory redundancies from a sale.

The group said The Macallan delivered another strong year of sales volume and revenue growth and consolidated its position in some of the world’s most significant Scotch whisky markets including the US, Taiwan, and Japan.

Its new distillery and visitor centre, part of an ongoing investment of £500m in the brand, opened recently and the brand will embark on its first global advertising campaign in the autumn with an £11m budget. Highland Park also increased its contribution to the group’s performance after a 23 per cent increase in marketing investment.

The group said it continues to be well-positioned in the tequila market, the most valuable spirits category in the US, through its partnership with Tequila Partida.

However, it said the blended Scotch market continues to be challenging although the Famous Grouse achieved an all-time high market share.

Overall, Curle said the outlook for the business was encouraging.

“All regions are experiencing an upturn in economic growth and Scotch whisky exports are also in growth,” he said.

businessdesk@scotsman.com