Australian Whisky Holdings has officially been rebadged as Lark Distilling Co, signalling a new era for the ASX-listed owner of Tasmanian whisky brands including Lark and Nant.
The name change puts the finishing touch on a comprehensive overhaul of the AWH business initiated by new managing director Geoff Bainbridge, whose position was made permanent in October last year.
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“‘Australian Whisky Holdings’ defined us as Australian, defined us as whisky and as a holding company, and that’s the antithesis of what we are now,” Bainbridge told Drinks Adventures.
“Forty Spotted is our gin brand and it wasn’t in the name. We’re a distilling company that has one hero brand in Lark, and we’re in Tasmania.”
Bainbridge said the strategic direction of Lark Distilling Co is now much clearer following the sale of the Overeem Single Malt Whisky back to the Overeem family, the conclusion of the disastrous Nant Whisky barrel scheme, and Old Kempton Distillery’s buyback of the 12 per cent stake in its business held by AWH.
“I felt like when I took the business over, I was running three businesses with three different cultures and three different competing interests,” he said.
“These three businesses weren’t adding to each other. They were distracting management, they were sucking out resources and they were consuming cash.”
New leadership
Bainbridge is best known for having co-founded the Grill’d burger chain; an investment that he exited in 2017.
But prior to his entrepreneurial career, he had a nine-year stint in strategic and commercial roles at Foster’s Group, where he finished up in 2004 as managing director of its spirits business.
He said Lark Distilling Co now has the right mix of skills and experience, with its new look board including former Treasury Wine Estates CEO David Dearie as non-executive chairman, Seppeltsfield Wines owner Warren Randall and Laurent Ly of Spica Capital, a Hong Kong-based investment vehicle focused on the food and beverage sector.
“Part of the impetus for change was relevant experience,” Bainbridge said.
“David brings an extraordinary wealth of contacts; probably one of the best Rolodexes I’ve come across.
“He’s such a terrific sounding board, but he’s also great at opening doors for us.
“Seppeltsfield has one of the largest collections of port casks in Australia, so Warren gives us extraordinary insights around wood, and in my opinion, competitive advantage.
“Laurent is very capable at advising us on some of the challenges of financing a whisky business.
“We are a very collegiate board, working very well together, and we understand the role of management versus the role of the board.
“I think in a previous life that was very confused. Who was really running the company and who thought they were running the company?”
Making amends
Bainbridge said Lark Whisky founder Bill Lark had come round to the new regime, after initially writing to AWH shareholders urging them to vote against the boardroom coup initiated by major shareholder, Hobart rich lister Bruce Neill.
“Bill is such a great supporter now,” said Bainbridge
“I think the boardroom tussle took us all to places we didn’t want to be. And so when you come out of that, you then moderate your behaviours.
“I’m so grateful that Bill has supported us on this journey and and stayed with us. There’s genuine warmth and affection from the company to Bill and from Bill to the company.”
Overeem Whisky sale
The Overeem Whisky brand and inventory was sold to Sawford Distillery Pty Ltd for $962,000 in a deal that settles on June 29.
Bainbridge said he had formed the view that Lark Distilling Co would not be able to do justice to the Overeem brand, which is now back in the hands of founder Casey Overeem’s daughter Jane Sawford and her husband Mark Sawford.
“They are such good people… I felt that treating their brand as something lesser than Casey Overeem would have, would have caused us more damage in the end than it would good,” he said.
COVID-19 impacts
In an April 30 announcement to the ASX, Lark said the closure of the on-premise sales channel had resulted in a 35 per cent sales shortfall for its business as against revenue forecast for April.
“There has been no interruption to the core business of the making and laying down of
Lark and Nant whisky inventories, which are accumulating at the rate of 4,100 litres per week,” the company said.
Lark Distilling Co had a total 633,444 litres of whisky under maturation at the end of March 2020, with a value of $88 million.
See Part Two of the interview with Geoff Bainbridge here.
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