Ann: FY22 Results Presentation, page-3

I think this is a very solid set of results. The strength is obviously in the pricing, but the weakness has been in the volumes. The investor call really highlighted their emphasis on premium products, but still missing that link with scale, volume and a dependable product.

If we look at volumes, you can see it was around 72k litres. This is well below the potential 113k litres of maturation this year, and my original expectation of around 100k litres.


Even gin hasn't increased - but only now have they recruited a dedicated sales person for their gin. Seems like they are behind the ball in that. But at least they are catching up. They have substantially increased their sales expenses to support the growth. And we have also seen increased hospitality / venue expenses have they have The Still and Pontville Cellar Door coming online in 2H22.


I am not buying too much into the hype of the NSR at $269/L. If they want to scale to 1m litres per year by around the end of the decade, then they are going to need to focus less on the premium and more so on the blended symphonys, classic/casks, etc. And they really need to smash those domestic wholesale and export markets. Otherwise, they won't get the "halo effect" that Laura McBain talks about.


I still think the share price is currently offering around a ~10% discount to NTA. Maybe that's fair in the scheme of things, with the risk/reward on offer. But if they execute the sales volume growth partly through expanding their venues, but mainly through expanding wholesale (e.g. a trusted and dependable blended whisky through Dan Murphys) as well as export volumes (not just the premium stuff to high net worth, but special casks etc) then there will be a lot more value in the next five years from their asset base.

I am not phased about their earnings, but you can see my calculations here too.