What’s going on at Adnams?
Rumours are circulating about the state of play at Adnams following reports it is selling off its non-core assets to stay afloat. db reports. The post What’s going on at Adnams? appeared first on The Drinks Business.
Rumours are circulating about the state of play at Adnams following reports it is selling off its non-core assets to stay afloat. db reports.
As the Southwold-based brewer released its annual results this week, its interim chair Simon Townsend admitted that there is "no positive support whatsoever from the government" and lamented that, at present, Adnam's debt pile remains “unsustainable”.
Despite remarking that hospitality businesses were ‘“facing a number of headwinds” this year, a phrase we are hearing more and more as costs rise and rates do little to assist the sector, there was also the reminder that “questionable economic growth” and increases in employment costs as well as “unreliable consumer confidence” were pushing the industry under.
In two separate reports this week from both the East Anglian Daily Times and This is Money each shone a light on the issues at the business as they began to unfold and noted that despite during her first Budget last October, Chancellor Rachel Reeves had still laid on hikes to employers’ National Insurance Contributions and the national minimum wage, as well as a raft of tax hikes.
Townsend told reporters: “Businesses such as Adnams are receiving no positive support whatsoever from the government, despite our role as an important employer at the heart of the communities which we serve” and explained that, because of this, Adnams was being forced to look for its own “self-help story” to haul it from doom.
Both pub operators and brewers have recently called on the British government asking for assistance to help them through by offering a VAT cut on food and drinks sold in the hospitality industry or hopes that it might reform the business rates system in a bid to level the playing field with big beer and pub company businesses, but to no avail.
Still, despite job losses and venue closures following the tax-laden budget, cost pressures are continuing unabated and Adnams’ situation. A quandary which the brewery and pub company has already described as “unsustainable” despite its debt pile reducing from £15.9 million to £15.3 million over the year.
Now, Adnams has revealed that, without assistance or funding from elsewhere, it will now need to resort to start selling assets as a last ditch attempt to slash its debts.
Last year, when Adnams’ fiscal situation was being queried and yet it told db it was evaluating offers for moving its business forwards with a view to revealing plans later in the summer, telling db that it was “grateful” for customers’ “unwavering loyalty”.
Despite this, it denied that there were any plans to make an outright sale of its business and instead alluded to a plan to seek funds from elsewhere. Still, it remained tight-lipped over where it might acquire funds or how it might find its way out of its struggles. Additionally, last February, a spokesperson for the brewery explained: “Like many operators in the hospitality and brewing sectors, Adnams has been experiencing significant inflationary pressure on its labour, energy, raw ingredients and borrowing costs."
Then, in April 2024, Wood continued to dismiss rumours that Adnams was considering a sale of the business and assured that instead it was searching for external investment – short of a full takeover.
The beer and pub business has at least reduced its losses to £2.7 million over the year to 31 December, compared to £4 million the year prior, however despite these small signs of a turnaround, with sales rising 3% to £68.1 million the situation is still bleak.
As a nod to where the business has not been helped, sales of products in shops, including Southwold Bitter and Double Ghost pale ale also reportedly plummeted as “trading conditions on the High Street remained challenging”.
Last year, Adnams replaced its former boss Andy Wood with Jenny Hanlon who has taken the reins and attempted to navigate the business through the challenges. Upon arriving into the role, Hanlon explained that the business was looking at “securing additional capital from a successful funding process” and said it “would help us unlock this potential, enabling us to both reduce the company’s level of debt and interest costs, whilst enabling us to invest in this next phase of growth”.
According to Hanlon, the plan was “focused on ensuring Adnams fulfils its potential by becoming a profitable, brand-led, sales-focused organisation”.
The brewery has said that there are still hopes that it will be able to boost its fortunes by focusing on sales of its flagship brews Ghost Ship and Southwold Bitter which are still highly regarded within its portfolio.
db has reached out to Adnams for further comment on its current situation as well as hear more about what it hopes the government might do to assist in its survival.
To look back at Adnams' plight and understand why its next steps are crucial for its survival, read more from db here.
As the Southwold-based brewer released its annual results this week, its interim chair Simon Townsend admitted that there is "no positive support whatsoever from the government" and lamented that, at present, Adnam's debt pile remains “unsustainable”.
Despite remarking that hospitality businesses were ‘“facing a number of headwinds” this year, a phrase we are hearing more and more as costs rise and rates do little to assist the sector, there was also the reminder that “questionable economic growth” and increases in employment costs as well as “unreliable consumer confidence” were pushing the industry under.
In two separate reports this week from both the East Anglian Daily Times and This is Money each shone a light on the issues at the business as they began to unfold and noted that despite during her first Budget last October, Chancellor Rachel Reeves had still laid on hikes to employers’ National Insurance Contributions and the national minimum wage, as well as a raft of tax hikes.
Townsend told reporters: “Businesses such as Adnams are receiving no positive support whatsoever from the government, despite our role as an important employer at the heart of the communities which we serve” and explained that, because of this, Adnams was being forced to look for its own “self-help story” to haul it from doom.
Both pub operators and brewers have recently called on the British government asking for assistance to help them through by offering a VAT cut on food and drinks sold in the hospitality industry or hopes that it might reform the business rates system in a bid to level the playing field with big beer and pub company businesses, but to no avail.
Still, despite job losses and venue closures following the tax-laden budget, cost pressures are continuing unabated and Adnams’ situation. A quandary which the brewery and pub company has already described as “unsustainable” despite its debt pile reducing from £15.9 million to £15.3 million over the year.
Now, Adnams has revealed that, without assistance or funding from elsewhere, it will now need to resort to start selling assets as a last ditch attempt to slash its debts.
Last year, when Adnams’ fiscal situation was being queried and yet it told db it was evaluating offers for moving its business forwards with a view to revealing plans later in the summer, telling db that it was “grateful” for customers’ “unwavering loyalty”.
Despite this, it denied that there were any plans to make an outright sale of its business and instead alluded to a plan to seek funds from elsewhere. Still, it remained tight-lipped over where it might acquire funds or how it might find its way out of its struggles. Additionally, last February, a spokesperson for the brewery explained: “Like many operators in the hospitality and brewing sectors, Adnams has been experiencing significant inflationary pressure on its labour, energy, raw ingredients and borrowing costs."
Then, in April 2024, Wood continued to dismiss rumours that Adnams was considering a sale of the business and assured that instead it was searching for external investment – short of a full takeover.
The beer and pub business has at least reduced its losses to £2.7 million over the year to 31 December, compared to £4 million the year prior, however despite these small signs of a turnaround, with sales rising 3% to £68.1 million the situation is still bleak.
As a nod to where the business has not been helped, sales of products in shops, including Southwold Bitter and Double Ghost pale ale also reportedly plummeted as “trading conditions on the High Street remained challenging”.
Last year, Adnams replaced its former boss Andy Wood with Jenny Hanlon who has taken the reins and attempted to navigate the business through the challenges. Upon arriving into the role, Hanlon explained that the business was looking at “securing additional capital from a successful funding process” and said it “would help us unlock this potential, enabling us to both reduce the company’s level of debt and interest costs, whilst enabling us to invest in this next phase of growth”.
According to Hanlon, the plan was “focused on ensuring Adnams fulfils its potential by becoming a profitable, brand-led, sales-focused organisation”.
The brewery has said that there are still hopes that it will be able to boost its fortunes by focusing on sales of its flagship brews Ghost Ship and Southwold Bitter which are still highly regarded within its portfolio.
db has reached out to Adnams for further comment on its current situation as well as hear more about what it hopes the government might do to assist in its survival.
To look back at Adnams' plight and understand why its next steps are crucial for its survival, read more from db here. 
