Coopers brewery looking for new license agreements

Coopers Pale Ale

Source: Daily Telegraph

The Daily Telegraph

COOPERS Brewery is looking for new licence deals and interstate sales to sustain the growth it has recorded over the past two decades.

Coopers managing director Dr Tim Cooper said the company was about to conclude 20 years of continuous growth at an average 9.9 per cent a year.

“It is going to be harder (as the base grows) but we reckon there’s still scope to keep growing our volumes,” he said.

“We may never reach 10 per cent of the national market, but we certainly think we can get to 7 per cent. It may take us another 10 years but we think we can get there.”

Coopers accounts for 4.3 per cent of the total national volume.

“We’d like to expand the portfolio even though there are fewer opportunities because of consolidation in the industry globally,” Dr Cooper said.

Expanding on comments made to a Committee for Economic Development of Australia forum, Dr Cooper said that things had to change.

“We at Coopers are lucky in a way that for a company of our size with a turnover approaching $200 million, we don’t employ a lot of people,” he said.

“We only employ 130 people here. Most companies with our turnover would employ far more people and their payroll and WorkCover costs would be much larger.”

However, Dr Cooper, a lifelong Liberal Party member, said change would not be easy.

“We’d all like to see less business taxes,” he said.

“Whichever government is in next is going to have to seriously reduce state recurrent expenditure. Our economy in SA is fragile and the sad thing is that over the past 10 years we really couldn’t afford the increase in government expenditure.

“We’ve gone from about $8 billion to $16 billion. Unfortunately, that’s just too much of a burden for our economy.

“We’ve only got a population of 1.6 million.

“We’ve been running at beyond our capacity to pay.

“It is hard – it is hard for anyone to reduce expenditure.

“Clearly, for business, I don’t think we can expect anything to change quickly.

“We’re fortunate because our growth has allowed us to cover the increases which have gone from $700,000 to $1.8 million.

“But for a smaller company with the same number of employees that might be quite a problem.

“It’s a real issue for SA, we have to worry about it.”

Among its own labels, Dr Cooper said the Celebration Ale launched for the company’s 150th anniversary in 2012 will be retained in the line-up.

The Thomas Cooper Selection is to be expanded.

“From the brewing side, we’re still working on that, we’e looking at different options,” he said.

“It’ll be a definitive contribution to the craft beer market.

“They may not be big selling labels but they’ll be more interesting for those drinkers who like different flavours in their beers.”

Earlier this month at the Australian International Beer Awards in Melbourne, Coopers Sparkling Ale won the best Australian-style pale ale award.

Coopers has been building sales interstate and in January sold more beer in NSW than in SA.

However, in the 10 months year to date, SA still leads at 29.5 per cent of Coopers’ sales compared to 25.9 per cent in NSW.

“NSW is catching up and SA sales are flat-lining because of demographics,” Dr Cooper said.

Coopers continues to export but is battling the headwind of the high dollar.

US sales have fallen from 70,000 cases a year to 30,000.

UK sales are at 25,000 cases and Asia 30,000.

 

The revised Coopers history book – Jolly Good Ale and Old  – contains three new chapters since the second edition was published 1998.

The first takes in the relocation from Coopers’ traditional home in east suburban Leabrook to the serious industrial setting of Regency Park.

The second covers the bitter battle for control of the company with a hostile takeover bid by SA Brewing’s owner, then known as Lion Nathan.

Finally, the book looks at the growth since Coopers moved, including the formation of distribution venture Premium Beverages, the licence brewing contracts, acquisition of home-kit company Mr Beer in the US and the sale of the honey business.

A limited print run for subscribers whose names are recorded in the book raised funds to support the Coopers Foundation charity.

The Coopers book can be ordered through its website for $69.95.

 

Coopers has the licence to brew for the Carlsberg group, based in Germany, and Japan’s Sapporo.

The state’s biggest beer maker, SA Brewing, is owned by Lion, which has partnerships with Anheuser-Busch Inbev and Heineken – the biggest and third biggest beer companies in the world. Australia’s other major player, Carlton and United Breweries, is owned by SABMiller, the world’s second biggest.

Carlsberg, which includes the Kronenbourg label, is fourth globally.

Dr Cooper was speaking as the company this week published an updated edition of a book tracing the Coopers history. It shows Coopers’ production hit a low point of 11 million litres a year in 1992-93 after four years of decline.

Since then the brewer has chalked up an increase every year to be on target for about 70 million litres a year now.

Profits, while not as linear, have grown from an after-tax loss of nearly $2 million in 1992-93 to a record $27.3 million for 2011-12.

“We’re going along pretty well this year but we don’t know yet exactly where we’ll end up,” Dr Cooper said. “Our volumes are up and our profitability has improved.

“We’ve had an increase in our Coopers beer volume but more than 50 per cent of the extra volume is coming from the new arrangement to brew for Carlsberg and Kronenbourg.”

While committed to South Australia, Dr Cooper is distressed by the growing burden on businesses of government taxes and charges.

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