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Craft beer aides BWS, Dan Murphy’s sales surge

In their 2021 financial year results the Endeavour Group – owner of Dan Murphy’s and BWS – has reported a 9.6 per cent increase in retail sales to $10.2 billion while online sales grew by 34.7 per cent. Online now accounts for 8.4 per cent of their total retail sales – up from 6.9 per cent in 2020.

The report said both BWS and Dan Murphy’s were well positioned in the market, with customer engagement metrics improving again in F21 while the My Dan’s Membership program attracted an additional one million members to now exceed 5.5 million.

“Customers switched to in-home consumption, sparked by COVID-19 related restrictions and the closure of on-premise venues which began in March 2020,” the report said. “This created increased retail demand which remained elevated across the first half of F21. During the second half of the financial year, on-premise restrictions eased and retail trading began to normalise.

“All major categories of drinks were in growth in F21. The trend towards spirits continued, with this category growing at over 20 per cent in F21 following similarly strong growth in F20. The ongoing shift to premium products was also seen across many categories. There was particularly strong growth in craft beer, Champagne and gin, as well as no-alcohol and low-alcohol alternatives.

“Endeavour’s digital business model leverages its extensive network to offer exceptional convenience to customers, including fast delivery and pick-up options. In F21, sales fulfilled by pick-up grew ahead of delivery and the shift to digital has been sustained even as restrictions eased in various states.”

The Group also said it selectively expanded its store network during F21 and there were now 251 Dan Murphy’s stores and 1,392 BWS stores in Australia which represents a net increase of 33 stores.

Managing director and CEO Steve Donohue said: “The creation of Endeavour Group and subsequent demerger from Woolworths Group was a significant undertaking and we are now proudly trading on the ASX as Australia’s leading drinks and hospitality business… with 1,643 retail stores, 339 hotels, digital assets that attract up to 18 million visits per month and a high quality portfolio of our own brands”.

The report stated the Endeavour board had determined to pay a fully franked final dividend of 7 cents per share. “This represents an expected total payment of $125 million to the Group’s 450,000+ shareholders” it said. Endeavour Group shares will trade ex-dividend from 1 September 2021 and the distribution will be paid to shareholders on 22 September 2021.

Commenting on the outlook for the 2022 financial year Steve Donohue said: “The strength of this year’s
result has demonstrated the resilience of our business model… We are excited that we are entering the new year with a robust balance sheet and a significant number of opportunities to create value, including growing our digital engagement, expanding and enhancing our network and optimising our business through a focus on profitability and capital management”.

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