Burn Stewart Distillers Celebrate Strong Financial Results - 19th September, 2011

Whisky Exports Drive Portfolio Success

Burn Stewart Distillers, producers of Scottish Leader, Black Bottle, Bunnahabhain, Tobermory, Deanston and Ledaig whiskies, have announced its financial results for the year ended 31st December 2010.

The main highlights of the announcement are:

• Strong performance by all brands in their key markets

• Gross profit £18.3m (2009: £17.2m)

• Net profit £3.7m (2009: £1.2m)

The company which employs 250 people across its distilling, blending, bottling, commercial and administration activities in the UK, and sales administration internationally has seen continued growth across its core brands with particularly strong performances in Taiwan, South Africa and the UK.

The key drivers for this success include the 13% growth of flagship brand Scottish Leader, coupled with the growth of Scottish Leader’s market share across all key markets. Overall, cased export revenue is also on the increase - achieving 11% growth on 2009 with notable success in Taiwan, US, and Baltics.

The company continues to invest in capital expenditure, allocating £0.4m in 2010, taking the investment for the last 3 years to £2.4m. The company has also invested in a new leadership staff training programme which has reached over 20% of the company’s workforce. Over the next three years a multi million pound capital investment programme is planned to further enhance the capability of the business. Included in this plan, is the creation of a new visitor centre at Deanston Distillery, opening during Spring 2012, which aims to significantly enhance the retail and consumer experience of the brand.

The entire malt portfolio - Bunnahabhain, Tobermory, Deanston and Ledaig whiskies - enjoyed an extremely successful re-pack in 2010 with new packaging, labelling and bottle design. Furthermore, presenting un-chill filtered malts creates exciting opportunities to position the malt portfolio as niche players in the industry. Future plans for the malt portfolio include further tapping into growing markets in Taiwan, USA and Europe, coupled with a strong investment focus on Russia.

Markets providing the key focus for Scottish Leader will be Taiwan, South Africa and The Baltics. In addition, the flagship brand will also be looking to build upon and strengthen existing distribution partnerships in the Ukraine, Poland and Russia to allow for further penetration into these emerging markets, and providing the backbone for growth.

The company’s portfolio of brands was strengthened in 2010 when a partnership deal with Angostura Holdings Ltd was signed. The deal announced that Burn Stewart Distillers would be responsible for distribution and marketing of the world renowned Aromatic Bitters and premium rum range across EMEA. This addition to the company portfolio compliments future plans for growth within the Scotch market and a growing rum category.

Commenting on the results, Fraser Thornton, Managing Director, said:

“It is very pleasing to note the sustained improvement in the financial performance of the company. Our primary focus is to develop and grow the strong portfolio of brands we have and, in so doing, continue to consolidate the relationships we enjoy with key retail partners, selected overseas bulk customers and our global distributor network. We have enjoyed another year of growth and have opened up new markets as well as continuing to build our brands in existing markets. Our bold move to un-chill filtered malts has excited our consumers and the trade and has allowed us to provide a niche offering to those consumers who want to explore. The investment at Deanston will allow us to develop a new brand experience for consumers and invest in the heritage of the Deanston brand. We believe the future is very positive for the Scotch Whisky Industry and we look forward to continued growth across our entire brand portfolio.’