Big Rock Brewery (BR) Q1 2024 earnings summary

Executive summary

• Q1 performance weakened as reduced co-packing volumes pressured revenue and earnings; results largely met budget and the shortfall was anticipated.

• Focus remains on balancing production across quarters, growing co-packing volumes, and developing premium alcoholic and non-alcoholic products.

Financial highlights

• Wholesale sales volumes fell 4.2% YoY to 32,352 hl from 33,778 hl.

• Net revenue declined to $8.582m from $10.451m, primarily due to reduced co-packing activity.

• Operating loss widened to $2.299m from $0.144m; net loss widened to $3.073m from $0.255m.

• Adjusted EBITDA was $(1.473)m versus $0.701m, a $2.174m decline, mainly from lower contract and co-packing volumes.

Outlook and guidance

• Management expects to secure additional co-packing volumes by year-end and says this supports its production-balancing and cost-reduction strategy.

• The 2024 objective is to achieve budget and exceed the $2.2m Adjusted EBITDA generated in 2023 through improved co-packing volumes and arrangements.

• Several product innovation releases are planned for the balance of 2024.