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Annual Report 2023 - Financial Review

Annual Report 2023

Financial Review


Chief Financial Officer

Paul Hyde

"Our excellent performance reflects our ongoing focus on the faster-growing ultra-premium category"

Our excellent performance this year reflects our ongoing focus on the faster growing ultra-premium category, and our sustained high levels of investment behind our brands which drive increased consumer demand and the growth of our business.

Core revenue and Core Contribution grew by 22% and 25% respectively on the previous year, with growth across all our business units. Pre-exceptional profit before tax increased by 43% with the performance of the underlying business being supplemented by weaker sterling and therefore a higher reported profit. Our retained profit for the financial year (before exceptional items) grew by 84% which was flattered by the non-recurring deferred taxation charge in the prior year.

These results are particularly satisfying as the business has had to navigate a series of external challenges, including supply chain disruption, our exit from the Russian market, and global inflationary pressures.

We have increased our investment in capital expenditure to ensure that we have both the quality and capacity in our operations to provide long-term sustainable growth, along with strategic investments in Grupo Estevez and Wyoming Whiskey. In addition, the Group returned funds to shareholders through share buybacks totalling £220m.

Group Financial Performance (reported on a constant currency basis)

Core revenue

Core revenue grew by 22% to £1,082m, reaching the milestone of £1bn for the first time, with strong momentum across all our business units. Our continued focus on commercial excellence, improved market, channel and product mix together with price increases drove this excellent performance.  

Brand investment

Brand investment is a critical factor driving the ongoing growth of Edrington, supporting brand equity and engaging and educating consumers.  We have activated record levels of investment during the year, focussing on high quality and creative marketing campaigns, consumer education and experiences, innovative collaborations and the launch of outstanding new products.  Our total brand investment of £233m was up 28% on the previous year and represents a re-investment level of 21% of net sales.

Core Contribution

Despite significant increases in our operating costs and our increase in brand investment, Core Contribution grew at 25% to £414m. This growth means that we have been able to maintain our operating margin percentage through an improved product and market mix and the execution of price increases.  

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