Coopers Brewery invests in new malting plant

Coopers Brewery, the largest independent brewer in Australia, is spending AUD 63 million on a new malting plant at its Adelaide site. The plant will be completed by the end of 2017, and heralds a return to malting for Coopers. It had sold its stake in Adelaide Malting Company in 2002 to help fund relocating its operations from Adelaide’s leafy eastern suburbs to a new brewery at Regency Park.

However, its homebrewing venture in the US, Mr Beer, bought for AUD 11 million (USD 11.2 million) in in 2011, has brought some pain. The homebrewing market in the US is witnessing fierce competition and a drop off in numbers of amateur brewers as many decided to upscale to microbrewing.

Complying with Australian accounting standards, this has led Coopers Brewery to write down the value of its Mr Beer business by AUD 7.5 million (USD 5.8 million) after big retailers, including Walmart, stopped stocking the homebrewing kits, media reported on 7 November 2016.

The writedown of goodwill on Mr Beer and one-off costs connected with the construction of the malting plant resulted in Coopers’ overall net profits after tax for 2015/16 (ended June 2016) to drop 16.3 percent to AUD 24.2 million. Total revenues were up 4.6 percent to AUD 246 million (USD 189 million).

Coopers’ beer sales in Australia rose 3.3 percent to reach 815,000 hl, while the overall beer market continued its decline. It maintained its national market share in Australia at around 5 percent.

Coopers competes against Carlton & United Breweries, which makes Victoria Bitter and Carlton Draught, and Lion, which makes Tooheys and XXXX Gold. CUB is now owned by AB-InBev after the takeover of SABMiller, while Lion is owned by Japan’s Kirin.