Innovation delivers a profit for brewery in the midst of the pandemic

Black Sheep Brewery made a profit during its 2020/21 financial year despite the massive impact of the pandemic on the pub and brewing industry.

For its financial year ending March 31, 2021, the Masham-based brewery achieved a profit, before interest and tax, of £1.014m.

Contributing to its success was the company’s ability to mobilise a more substantial e-commerce operation from the outset of the COVID-19 pandemic when pubs were forced to close and people asked to remain at home.

Black Sheep saw its online sales rise to £741,951 compared to £108,150 in the previous year.

This was supported by strong growth in its “off trade” sales, with customers also able to buy the brewery’s products from supermarkets and other retail outlets during the lockdowns.

Its off trade turnover grew from £6.86m to £9.54m, boosted by additional sales of brands such as Black Sheep Ale, which outperformed the national ale category average of 21.4% with a 35.9% growth in sales.

The UK’s mainstream stout category saw growth of 47%, which was outperformed by Black Sheep’s Milk Stout, which experienced growth more than 50%.

Black Sheep introduced beer delivery and collection services, a food delivery service along with relationships with other e-commerce sites and small Yorkshire farm and retails shops.

These company’s brewers created nine new beers during lockdown and also, for the first time, sold Black Sheep Best Bitter in bottles while pubs remained shut.

Thanks to the forced closure of pubs and restaurants, on trade sales fell from £9.83m to £2.24m during the financial year.

In addition, with Black Sheep’s own collection of five retail outlets closed during the lockdowns, retail turnover reduced from £2.72m to £1.5m.

As result of the restricted performance of its off trade and retail operations and wider impact on the business of the pandemic, Black Sheep returned an adjusted operating loss of £1.05m.

Andy Slee, chairman, said: “The fact Black Sheep was in a stronger financial position at the end of March 2021 compared to March 2020 is simply extraordinary and testament to every member of the Black Sheep team who have made sacrifices to make this happen.

“With other companies in our sector, much larger than Black Sheep with centuries more heritage, reporting that last year was the most challenging year in their history, I have an overwhelming sense of pride in the efforts we have made to ensure this business has a positive future and can continue to serve our popular range of products to a loyal and growing customer base.”

Charlene Lyons, chief executive, added: “While the pandemic defined our last trading year, it created many opportunities.

“Faced with the scenario that all pubs, which are our dominant customer base, were forced to close we had to act swiftly.

“Utilising all Government schemes and grants, our focus was on diversification and the obvious pivot towards e-commence.

“We transformed a small part of our business into a thriving service as customers wanted to get their taste of Black Sheep while they remained at home.

“Year-on-year growth in our online sales was 600% and trade has remained strong since pubs reopened.

“I am immensely proud of what we have achieved in a year like no other, when the business’ very existence was threatened by the pandemic, but was characterised by the will, determination, dedication and commitment of everyone at Black Sheep whose contribution has been outstanding and exemplary.”


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