Controversial firm Brewdog aims to build one of the “world’s most valuable” beer brands as it unveiled its financial results for 2021 to its supporters and investors.
Co-founder James Watt, who has faced down a year of harsh criticism of his “challenging” managment style, said the company is aiming to become “one of the world’s five most valuable beer brands over the next five years” – weighing among brands such as Budweiser, Guinness, Heineken and Miller.
Writing in a preamble dubbed as the “capitain’s update” in the company’s annual report and accounts for the year ended 2021, Watt admitted that he “honestly thought we would not make it through the storm” of the pandemic in 2020.
He also addressed an anonymous letter with damaging allegations by made by dozens of ex-employees last June, blowing the whistle on what they described as “mysogynistic” and “toxic attitudes” towards staff and Brewdog bosses of “lies, hypocrisy and deceit”.
The letter published via social media sparked a significant backlash against the firm which it has fought with varying degrees of success since.
Employees faced ‘sensitive and upsetting’ experiences
In December Brewdog released a critical review it had commissioned, confirming employees had faced “sensitive and upsetting” experiences working for the firm.
But questions have been raised about the how the report was conducted, with people who were interviewed having raised a complaint with the Information Commissioner’s Office (ICO) against recruitment consultancy Wiser over the handling of supposedly anonymous personal data used in its review of Brewdog.
Watt highlighted his recent pledge to hand over a 5% stake in the Ellon-based firm worth an estimated £100 million to its workers and the implementation of a “radically new business model” in which bar staff would share out 50% of business of the firm’s on-trade business.
He further set out plans to invest £70m in the company’s expansion in this year, which includes 25 new locations such as “flagship” bars in both Las Vegas and Waterloo station which are due to open in the second half of the year.
In January, the company said it plans to float on the stock market targeting a valuation of £2bn which would trigger payouts for the firm’s legion of crowdfunded investors known as “equity punks” as well as US private equity company, TSG Consumer Partners and the founders themselves.
Pay cut for co-founder
BrewDog’s directors received pay packages worth a total of £4m last year, up from £1.26m in 2020.
The best-paid director – likely to be co-founder and chief executive James Watt – earned £442,000 in pay and pension contributions in 2021, down from £611,000 previously.
BrewDog narrowed pre-tax losses to £9.4 million for 2021, from £12.5m the year before.
Revenue surged to £285.6m in the latest period, including £2.3m from its non-alcohol range, compared with £237.8m in 2020.
The company said the improved financial performance was driven by continued growth of beer volumes across global operations and a partial re-opening of the on-trade as the year progressed.
The 2021 volume of 21.5 million gallons was up 23% on 2020, largely driven by sales in the UK, Germany and Australia.
BrewDog said: “The gradual return of hospitality during 2021 benefitted our on-trade customers and our bars.
“Global bars achieved revenue growth of 31% in 2021 from 2020, despite being closed or with heavily restricted trade for much of the year across all our geographies.”
The company reported of £14.2m of adjusted earnings before interest, taxes, depreciation, and amortisation for 2021, up from £7.9m a year earlier.