Bosses at Elgin-headquartered Speymalt Whisky Distributors said they were pushing ahead with the development of a second whisky distillery, The Cairn.
The 125-year-old business pointed to a number of global and domestic headwinds over the past year, including Brexit uncertainty, the introduction of tariffs on single malt Scotch in the US, the impact of Covid-19 – particularly in Asia in the final quarter of its financial year – and a “competitive” UK market.
Total sales were down 18 per cent to £33.7 million and pre-tax profit declined to £9.8m from £15.6m in 2019. However, net assets grew by more than 12 per cent to £55.4m.
Gordon & MacPhail managing director Ewen Mackintosh said: “Despite challenging conditions we remain confident in our ability to grow and are building for the future.
“Across the year we’ve invested in Gordon & MacPhail, including our brands, infrastructure and colleagues, as part of our commitment to the continued growth of what is now a fourth-generation family business. We’ve navigated challenging global conditions, including the initial impact of Covid-19, particularly in the Asian markets.
“We’re excited to see our plans come together, not least with the development of The Cairn as we build a distillery and brand that complements our existing distillery, Benromach. We look forward to sharing our plans with whisky enthusiasts across the world in due course.”
UK sales were also impacted by a strategic decision taken by the firm the previous year to exit the domestic wholesale operation from wine and beer to focus longer term on the premium spirits sector, including single malt whisky and gin.
As a result of that shift and general market conditions, UK sales fell to £20.6m from £26.7m, as anticipated.
Reflecting the various factors contributing to global uncertainty, international sales were down to £13.1m from £14.2m.
The Cairn was recently announced as the name for the company’s new whisky distillery. The family owned firm was granted planning permission for the distillery in the Cairngorms National Park last year and work started on site in July of this year.
It said the selected name reflected the “stunning location overlooking the Cairngorm mountains, at the gateway to Speyside”.
Scheduled to open in spring 2022, the distillery will include a visitor experience, tasting rooms, retail space and a coffee shop.
To help finance the new distillery, Gordon & MacPhail completed a £7m bulk sale of mature whisky to build up reserves. The Cairn will complement the firm’s existing Speyside single malt distillery, Benromach in Forres.
The award-winning Benromach range had another successful year with a growth in sales, helped by the launch of 125 bottles of Benromach 50 Years Old – the oldest expression in the current range.
More recently, there was investment in the Benromach brand, with a redesign and repackaging, as well as focusing on the core message: “Made by Hand for Genuine Character”.