Frédéric de Radiguès, Director General of Bofferding Brewery;

On Wednesday 10 February 2021, Luxembourg's Brasserie Nationale, also known as the Bofferding Brewery, held its annual press conference via video conference.

Georges Lentz Jr, CEO, and Frédéric de Radiguès, Director General, presented the results for the Bofferding Brewery and Munhowen SA for 2020.

Georges Lentz Jr began by recognising the challenging year that was 2020, although he praised the solidarity shown by the Luxembourg state, store owners and the brewery itself, all of whom “have done their best to cushion the shock of the crisis”. He added that the company’s strong financial position paired with careful management allowed the brewery to “manage these setbacks”.

Bofferding Brewery

Bofferding Brewery sales at the start of 2020 were encouraging, especially in the Grand Est region in France where progress was notable. From March onwards, the beer industry suffered a first setback with the first lockdown. While the summer was conducive to the consumption of beverages and had raised hopes for a less catastrophic year than envisaged in the first quarter, the second wave dashed any hope of ending 2020 with limited damage.

In 2020, the Bofferding Brewery produced 138,000 hl of beer and water, a decrease of 19,000 hl. Beer production fell by 47,200 hl to 110,500 hl (including a decrease of 39,900 hl of beer in barrels). The brewery's total turnover fell from over €10.9 million to €8.9 million, i.e. a decrease of 18.5% over one year. EBITDA fell from €3.5 million in 2019 to €2.1 million in 2020 (down 39.9%). 

2020 was also a year of huge investment for the Bofferding Brewery, which invested a total of €9.5 million in the new Lodyss mineral water and Bofferding Bio brands, a new racking hall (for Lodyss), a new boiler and micro breweries and visits.

In March 2020, the Bofferding Brewery launched Lodyss mineral water. The water, which dates from the Ice Age, has met with success, with sales exceeding 2.8 million litres at the end of the year. To enable Lodyss to be racked in optimal conditions, the brewery carried out a major modernisation of its racking hall. The investment, which amounted to €6.6 million, has also resulted in significant water and energy savings.

With the same aim of saving energy, the Bofferding Brewery invested in a new boiler allowing energy savings of 15%, which is equivalent to two months of the brewery's annual gas consumption. This investment amounted to €350,000.

Building on the success of its Bio Funck - Bricher beer, the Bofferding Brewery launched a second organic brand: Bofferding Bio. This beer completes the range of the Bofferding brand and is a response to the growing demand for organic products brewed with raw materials of regional origin.

In addition, the installation work for the company’s experimental brewery began recently. With a capacity of 2.0 hl per brew, it is expected to not only improve the brewing of beers, but also provide beer lovers who dream of brewing their own beers with a high-performance installation. This microbrewery will also be equipped with a tasting room with a capacity of 80 people. The inauguration is scheduled for the end of the first half of 2021. The microbrewery and the Lodyss well will be integrated into Bofferding Brewery tours - a popular attraction that draws around 10,000 visitors in normal years. Such visits had to be suspended in 2020 as a health precaution.

Munhowen

Munhowen, which is 100% owned by the Bofferding Brewery, achieved a turnover of €61.95 million in 2020 (down 21% over one year). The total sales of liquid products during the past year amounted to 318,600 hl, down 26% (401,600 hl in 2019). EBITDA amounted to €1,520,000 and fell 76%. Despite this crisis, Munhowen did not slow down its efforts to invest in its customers and brands. In 2020, these investments amounted to €3.6 million.

Horesca

In addition to state aid and the efforts of business owners and unions, the particularly vulnerable hospitality sector counted on in-kind subsidies (to the tune of €5 million) from the Bofferding Brewery and Munhowen.

Events Sector

The negative impact of cancelled / rescheduled festivities and events due to the pandemic was also discussed. While in 2019, Munhowen was able to sell 77,000 hl of its products through its 63 sellers, sales fell 35.5% in 2020 to 49,600 hl. Only distributors specialising in home delivery were able to limit the damage.

Logistics

From the start of 2020, the Bofferding Brewery logistics department was put to the test with two shutdowns of activity for more than 60% of the workforce. In its ongoing effort to reduce the nuisance of road transport, Munhowen used transport by sea for beer imports from Portugal and by train for products from Italy.

The Bofferding Brewery also implemented a warehouse management system to ensure complete traceability from the depot.

Exports

In 2020, the Bofferding Brewery's new client in Cameroon was its largest exporter. More than 240,000 bottles were sent to Africa in a few months. A new export market has also been developed in the Narbonne (France) sector.

Mass Distribution

Lockdown has benefited sales of the Bofferding Brewery brands in the mass distribution sector. These sales experienced a growth of 19% in 2020, although remain far from compensating for losses in the hospitality sector.

Home and Office Consumption Market

2020 was also an important year for the development of the company's e-commerce activity. With the launch of the drinx.lu site in April 2020, the ambition is to become the benchmark for home beverage delivery. The home delivery network, including offices, allows delivery within 24 hours. These deliveries are free for orders over €100. The "click & collect" system implemented in 2020 now facilitates the collection of pre-ordered goods. 

Sales in the office market sector have fallen by more than 50%.

Marketing

Lodyss, which was launched at the start of the pandemic, will mark the year 2020. Considerable introductory efforts have been made and a significant advertising campaign raised brand awareness among consumers.

During its first participation in the US Open Beer Championship, Bofferding obtained the bronze medal (among more than 6,000 beers in 140 categories). Battin and Bofferding also won the 1st and 2nd prizes respectively within the framework of the prestigious “Top Brands” awards.

In addition, Battin was voted the favourite brand of Luxembourgers among all the brands of alcoholic beverages in the Grand Duchy, whilst Funck-Bricher continued to show a strong growth rate.

Frédéric de Radiguès concluded: "2020 was a year of crisis and opportunity. An unprecedented crisis for all players in our sector. The Brasserie Nationale and Munhowen took advantage of this situation to question themselves in order to become more resilient and more competitive in the future".