Berry Bros posts £7.3 million loss14th October, 2013 by Lucy Shaw
London-based fine wine merchant Berry Bros & Rudd has posted a loss of £7.3m this year – the first in recent memory for the family-owned company.
Accounts filed this week show Berry Bros fell to a £7.3m pre-tax loss for the 12 months to 31 March, from a £1.4m profit over the same period a year ago.
Speaking to The Telegraph, BBR’s managing director, Hugh Sturges, described the loss as the “darkest hour before the dawn” as the company pushes on with a five-year plan to focus on premium spirits and grow its wine business in Asia.
“We have not made a loss during my time here, which is 12 years,” Sturges said, though stressed that the losses were expected, with one forecast for last year.
Berry Bros’ outgoings have increased as a result of acquiring Lincolnshire-based importer, Richards Walford.
Meanwhile, it has injected £3m in opening companies in Hong Kong and Singapore to capitalise on the growing thirst for fine wine in Asia.
The company is also expanding its historic St James’s headquarters in order to grow the corporate hospitality and wine school arms of the business, and has opened a warehouse for its customers to store their fine wine “in bond.”
Sturges expects the business to return to profitability in two years.
“This is about driving the value of the business at the same time as the profits,” he told The Telegraph.
With a strong focus on en primeur, BBR got lucky in both 2010 and 2011 with strong sales of the highly acclaimed Bordeaux 2009 and 2010 vintages – two of the most successful vintages in the history region in terms of quality and sales.
In contrast, interest in and sales of the 2011 vintage dipped dramatically last year, with BBR’s fine wine director Max Lalondrelle describing the Bordeaux 2011 en primeur campaign as the “worst in recent memory.”
At the time, Lalondrelle told the drinks business that in 2009, BBR had made £115 million in en primeur sales, in 2010 a combination of price and quantity knocked it down to £65m and a target of £30m was set for 2012, though he admitted he would “be happy” if the company made £15m from the campaign.
Berry Bros & Rudd has been supplying the Royal Family since the reign of King George III.