BenRiach chief toasts £27m bank deal that will support expansion

Billy Walker, BenRiach’s managing director, confirmed the funding gave the company “huge amounts of headroom” as it prepares to launch its first “own make” ten-year-old single malt since it bought its first distillery on Speyside from Chivas Regal in 2004. The firm also has plans to revive a blended whisky brand.

The funding, which replaces the firm’s credit facility with Clydesdale Bank, will allow BenRiach to take advantage of what Walker describes as a “golden period” for Scotch whisky as demand abroad soars.

The firm also makes GlenDronach single malt after buying that distillery in 2008 from Pernod Ricard.

Walker said: “It [the financing] allows us to have plans. It means we can comfortably look at doing additional things – we have headroom.

“Primarily, we intend to improve what we have and invest in new stock. And we have ambitions to access a blended Scotch whisky brand.”

He added: “We find ourselves in one of the golden periods in the industry.”

In the year to the end of 2010, the firm grew sales 7 per cent to £16.1m after it acquired a bottling plant in Newbridge, on the outskirts of Edinburgh, also from Chivas. But pre-tax profits slipped from £3.2m to £2.7m and it had £20.5m in bank loans and overdrafts.

Walker said: “Our core business is doing pretty well. We are very hopeful we will continue to grow both the single malts, and the market is receptive to the boutique offer we have.”

The company supplies a range of 12- to 15-year-old single malt whiskies under the BenRiach and GlenDronach brands to customers throughout the world. Key markets include western Europe, Asia, North America and, increasingly, Brazil and other Latin American economies.

Walker insisted the switch from Clydesdale to RBS was “not because Clydesdale was a bad bank, it was actually very good to us”.

“But the facility on offer from the Royal is an asset finance facility for a three-year period – it makes life more transparent for us,” he said.

“Having filled over 10,000 casks of single malt in 2011 for the first time since the distillery changed ownership in 2004, this new funding facility will enable us to expand our business to meet the worldwide demand for our highly regarded whiskies.”

Eddie Rintoul, managing director of Royal Bank of Scotland Corporate & Institutional Banking, said: “We are delighted to be able to contribute to BenRiach’s ongoing expansion and success with this funding package and new full banking relationship.

“By linking the financing to stock levels, we are able to supply BenRiach with a highly flexible facility that will help the firm meet its global business aspirations.”

BenRiach was launched in 2004 when Walker, along with South African investors Geoff Bell and Wayne Keiswetter, bought their first distillery near Elgin for £5m.

At the recent 2011 Malt Maniacs Awards, the company won two gold, four silver and three bronze medals.