Pernod Ricard to double Midleton Distillery capacity

celticbest

Some good investment news for a change......

IRELAND: Pernod Ricard to double Midleton Distillery capacity

By: Chris Mercer | 6 May 2011 EUR100m (US$145m) investment planned
Jameson demand booming

Fresh focus on single pot still whiskeys

Pernod Ricard's Irish Distillers division has brought forward plans to invest EUR100m (US$145m) to double capacity at its Midleton distillery in Ireland.

The unit expects to increase the distillery's capacity to just over 60m litres of alcohol per year, compared to the current 33m-litre maximum, within the next two years.

Strong demand for Jameson, particularly in the US, has forced the group to bring forward its investment plan to keep up with demand. The move will also provide for anticipated growth in the group's single pot still whiskeys.

"Even 12 or 18 months ago, we were not expecting to have to increase our capacity so quickly," Midleton's master distiller, Barry Crockett, told just-drinks last night (5 May).

Jameson's net sales increased by 22% for the first nine months of Pernod's fiscal year, to the end of March, the French drinks maker announced in its third quarter trading statement yesterday. Irish Distillers' CEO, Alex Ricard, said demand for Jameson, which has recently reached 1m cases in the US alone, is "marvellous".

Ricard made his comments during a dinner at the Midleton distillery to mark the launch of Irish Distillers' renewed focus on single pot still whiskeys. Alongside relaunching Redbreast and Green Spot, the group has launched two high-end single pot still whiskeys, Powers John's Lane and Midleton Barry Crockett Legacy.

The firm is keen to renew consumers' interest in single pot still Irish whiskeys after many decades of decline for the expressions. According to Alex Ricard, the company has a 22-year launch programme mapped out. "Every single year we will have a few new releases and innovations," he said.

Crockett believes Irish whiskey can learn lessons from the rise of single malt whiskies in Scotland. "Single malt Scotch was unheard of 40 years ago," he said. "We believe that single pot still whiskeys can do for us for what single malts did for Scotch."

As part of the EUR100m distillery expansion, Midleton will increase its capacity for single pot still whiskeys from around 10m litres of alcohol to 22m.

Separately, Irish Distillers will also expand warehouse facilities. Last month, it acquired land at Dungourney, around nine kilometres from Midleton, where it intends to build around 20 warehouses. It currently has 38 on the Midleton distillery site and has been adding two new warehouses per year for the past several years.

From Just-Drinks.com, http://www.just-drinks.com/news/pernod-ricard-to-double-midleton-distillery-capacity_id103780.aspx

Tipp Man

good news, more good news stories like this will make a pleasant change

Drink - one of the things we do well

bamboozle

McNulty from The Wire must take some credit for boosting Jameson sales in the states, he rarely was seen on the wire not holding a bottle!

celticbest

Tipp Man wrote: »

good news, more good news stories like this will make a pleasant change

Drink - one of the things we do well

Spot on 100%....

I just watched the news on TV3 & no mention of this investment?? It hasn't made the headlines on RTE's 6-1 either, you would think any investment of this sort would be headline news in the current economic climate.

cavedave

I have heard some rumours of a bubble in whiskey. This is fairly speculative but the reasoning is as follows. Pension funds love whiskey as you invest and then forget about the investment for x years. X being 3,5,10 or 20. This means unlike stocks and other commodities you can buy something once and then forget about it. There may also be some balance sheet advantage to such a long term investment.

There was a bubble in Irish whiskey before in the 1890's I believe. All the fancy mirrors and such with a whiskey you have never heard of it date from the time. Realising there was too much supply the companies started giving away the really ornate advertisements to pubs in the hopes of raising demand for their product. For most of them it did not work.

I am not 100% on any of this either the history or the pension stuff but I thought it was interesting.

alan85

cavedave wrote: »

I have heard some rumours of a bubble in whiskey. This is fairly speculative but the reasoning is as follows. Pension funds love whiskey as you invest and then forget about the investment for x years. X being 3,5,10 or 20. This means unlike stocks and other commodities you can buy something once and then forget about it. There may also be some balance sheet advantage to such a long term investment.

There was a bubble in Irish whiskey before in the 1890's I believe. All the fancy mirrors and such with a whiskey you have never heard of it date from the time. Realising there was too much supply the companies started giving away the really ornate advertisements to pubs in the hopes of raising demand for their product. For most of them it did not work.

I am not 100% on any of this either the history or the pension stuff but I thought it was interesting.

If so, I'm sure you would be seeing similar investment in wine and other whiskeys.

Redbreast is my favourite. It's ultra smooth! I'm not surprised to see it doing well.

cavedave

Bubble was probably the wrong word. I imagine the bet is that China, India and Brazil get into Irish whiskey as a luxury good. And if they get richer they buy more luxury goods.

It is the case of using Irish produce and adding value to them. Irish barley or milk might not be worth much raw but turn them into good whiskey or baileys and you can make some profit.

There have been lots of new craft beer breweries in Ireland recently. Again adding value to our base produce.

Solair

celticbest wrote: »

Spot on 100%....

I just watched the news on TV3 & no mention of this investment?? It hasn't made the headlines on RTE's 6-1 either, you would think any investment of this sort would be headline news in the current economic climate.

It's in Cork. RTE is a local station that serves the area between Donnybrook and the Merrion Road. It has an outreach service that serves Foxrock and the Dundrum Town Centre.

While it collects tax from Northsiders and from "Down The Country" (places you can't walk to from Grafton St.) it avoids actually going to those places at all costs.

dubhthach

One of the big growth areas is the push behind "Single Pot Still" (Pure Pot Still -- rebrand) as a premium product. As a result they've recently done rebranding on Green Spot, Redbreast (15 year old now available) and launched "Powers John's Lane" and "Midleton Barry Crockett Legacy", the "Powers John's Lane" is suppose to be quite comparable to the original "Pure Pot Still" Powers that was distilled up until the late 1960's.