Luxembourg family-owned brewers, La Brasserie Nationale (Bofferding), published their results for 2016, noting a positive up-swing in the second half of the year which may have put an end to a number of difficult years in a market whose tastes and habits are rapidly changing.
“According to our indications, this turnaround seems to announce a definite recovery in the consumption of beer and especially in our mature markets. Germany and the United States show positive results, even if their progressions remain modest. On the other hand, in emerging markets, the trend has reversed.
The Chinese market, for example, which represents slightly more than 25% of the world market and which was traditionally in strong growth, shows a marked slowdown. Thus, as for the years 2014 and 2015, world production in 2016 is expected to remain stable compared to 2015,” said their report.
The group announced earnings before interest, taxes, depreciation and amortisation (EBITDA) of more than €10 million, including beer sales of 150,000 hectolitres generating €4.4 million.
The beer market has changed substantially over the years, witnessing the rise of “micro” and craft brewers in popular tastes. At the same time, people are going out less, and drinking more often at home, over meals, which means that they are also drinking less than they did before.
There are now 22 brewers in Luxembourg, compared to only three a few years ago, which is in turn attracting the attention of major brand owners such as ABIndev-SAB, the owner of Diekirch and Mousel brands and which is increasingly interested in the micro-breweries market, investing heavily in their acquisition.
Notwithstanding that growth, imported beers still account for more than 50% of sales in Luxembourg.
Bofferding launched a new type of beer in 2016, HOP, an easy-drinking, “dry-hopped-lager”, which was hailed as an immediate success, and also invested in the acquisition of a new labelling operation. A minor make-over came with new long-neck bottles, and new labels.
Munhowen, a subsidiary of La Brasserie Nationale responsible for its marketing and administration, was also said to have produced more than satisfactory results.
The volume of sales of liquid products exceeded 372,000 hectolitres over 2016, and 142,000 kilograms of dry products. Revenue from all products increased by €820,000 to €68.400 million and EBITDA increased by 4.4% to €5.690 million on sales in Luxembourg, Belgium (ex. Flanders), and eastern France.
The company has made significant investments this year in response to the changes and new opportunities in the market, investing €4.5 million over the year, a 10% increase.
Part of that investment has gone into the “Gëlle Flûte” programme, aimed at training service staff in order to deliver a higher level of service when dealing directly with customers in the hospitality rather than retail sector. This is aimed at addressing the fall, 2.5%, in the number of consumers who are choosing to eat and drink outside of home.
At the same time, an advertising campaign has been launched to promote the Battin brand, now the preferred brand of Luxembourg consumers.
Four new trucks were acquired, bringing the fleet number to 30, all of which are Euro 5 or higher, helping to reduce negative environmental impacts.