The Isle of Arran Distillers Ltd. is toasting impressive annual results, with 2015 showing a 25% growth in net profit. In a market perceived to have stalled, the results offer a more positive view of the category and a reflection of changing market dynamics.
Driven by a 16% growth in brand sales and increased visitor numbers to Arran’s Lochranza location, the results, which will be filed with Companies House in the next few days, are the latest in a succession of healthy profits reported over the last six years with a 130% increase since 2010.
A consistent and considered export strategy has also led to another year of impressive growth across over 45 markets. For the industry as whole, exports are under pressure with a 2.4% downturn. Arran, however is flourishing with export representing 61% of total turnover in 2015. While France remained a core market, the tough US market made up 9% exports with rising star Taiwan contributing 7% of total overseas sales.
Despite an apparent struggle within the Scotch whisky industry to grow sales in such an established sector, Arran believe that its results represent a shift within the category and proof of the sustainability of their business model.
Euan Mitchell, managing director, commented: “We are delighted with the results which renew our dedication to creating quality whisky with a story to tell. There is an undeniable consumer desire for authenticity, something which we can deliver as an independently owned Scottish business. In contrast, three quarters of Scottish distilleries are in the hands of international businesses.
“Our success shows that it is not only possible to survive in a challenging market, but to thrive. While the larger companies might be struggling, and that prompts a negative tone, we believe that the future for whisky is very promising.
Currently celebrating its 21st Anniversary, the distillery continues with a programme of ongoing investment. A new blending and tasting building was constructed in 2016 to welcome distributors from around the world and increase the focus on export sales. Planning permission has also been submitted for a new distillery site and visitor centre on the south of the island at Lagg.
With visitor numbers to the distillery at Lochranza up to 85,000 (from 66,000 in 2014), the new centre will accommodate this increase in whisky tourism as well as increasing capacity to meet the rising demand for the Arran Malt.
Euan Mitchell concluded: “As we toast our 21st anniversary, we remain very buoyant about future prospects and confident that our success represents a positive outlook for Scotch whisky.”