Adnams drowning its sorrows after beer sales slump

Its excellent beers can be a source of cheer in hard times, but perhaps the folk at Adnams haven't been enjoying enough of their product.

The half-yearly report from the Suffolk brewer is decidedly downbeat, warning of "very tough conditions" and tumbling beer sales across the industry.

Turnover was flat, like the beer, say lager drinkers, at £23.1 million, but profit slumped 27% to £641,000. There was a "very disappointing" 9.1% dip in beer volumes across the market, while Adnams' volumes fell 6.8%.

Chairman Jonathan Adnams described the results as "very disappointing" after a good performance last year.

Adnams, around since 1890, prides itself on the quality of its cask beer and the individuality of its 70 pubs. The chairman seems highly nervous about the future.

He warned: "There is no doubt that the beer industry is going through tough times, with strong competition and declining demand.

"The economy is in a highly uncertain state. We know that cutbacks are happening and will continue, we know that VAT will increase. We do not know whether this will presage a revival or a renewed decline."

Adnams welcomed the freeze on duty in the budget but hopes the duty escalator will now also be scrapped. He also criticised the "excessively high" taxpayer subsidy given to the smallest brewers, something he feels unfairly distorts a competitive market.

Bank debt fell from £12.9 million to £12.1 million.