Message from the CEO

After a year of significant challenge for all, I welcome this opportunity to publicly thank our employees, customers and consumers of our brands, whose adaptability and determination to make the best of the difficult circumstances fuelled Corby’s performance. Cheers to you and to the moments of inspiration and togetherness we shared!

Our goal for the year, which started and ended in the midst of the COVID-19 pandemic, was to not only weather the storm but also energize our business and build for the future. And I’m pleased to say that we’ve done that. In working hard to serve consumers facing disruption at home and at work, to help customers navigate the ever-changing environment and to keep our employees safe and motivated, we accelerated the transformation of our company and unlocked new opportunities to gain competitive advantage and create positive impact.

Putting our people first

Recognizing that our strength lies in our talented people, we spent a lot of time focused on them. With some employees continuing to work in our production facilities or in the field, and others working from home the entire year, we needed to ensure that they felt connected and supported. We dialled up our internal communications, paid increased attention to their mental health and well-being, and leaned on our leaders to prioritize conversations with their teams and keep their finger on the pulse of employee engagement. Many of these practices will continue post-pandemic, as we enter a new world of work with heightened employee expectations for flexibility, transparency and involvement.

Similarly, diversity and inclusion will remain a priority within our Board, our workforce and our corporate and brand communications. The acts of racism and intolerance witnessed in 2020 and 2021 underscored the need to push harder for change in our society, and we are doing so. We took quick action internally with the formation of a task force that has spearheaded education, communication and workplace policy initiatives. Brands like J.P. Wiser’s Canadian whisky have also stepped up by intentionally adopting a more inclusive brand identity.

The acts of racism and intolerance witnessed in 2020 and 2021 underscored the need to push harder for change in our society, and we are doing so.

Zeroing in on consumer trends

New trends have emerged across almost every industry during the pandemic, and the beverage alcohol industry has been no exception. Canadians’ tastes and preferences have evolved; they’ve explored new drinks and adjusted how they purchase and where they consume their wine and spirits. We’ve pivoted accordingly – launching on-trend products, partnering with on-premise customers on previously unimaginable take-out and delivery offerings, advancing our e-commerce capabilities, and more.

For example, while following stay-at-home orders, many consumers experimented with drinks and found a creative outlet in cocktail making. It has led to a cocktail renaissance, with people trying a little mixology of their own, purchasing cocktails-to-go from their favourite restaurants and embracing ready-to-drink (RTD) cocktails for at-home consumption and outdoor socializing. We’ve seen evidence of this trend in the performance of our McGuinness liqueurs, which returned to growth in fiscal 2021, as well as our J.P. Wiser’s Manhattan and Old Fashioned ready-to-serve cocktails and our Cabot Trail cream liqueur (Coureur des Bois in Québec). Corby has an outstanding portfolio to win in the cocktail occasion and we’re rolling out a full slate of innovations to strengthen our position, including high-quality RTD cocktails such as Ungava Gin & Tonic and Absolut Mango Mule.

While e-commerce had been booming in other industries for years, it took the pandemic-related lockdowns and public health restrictions for it to truly take hold in the beverage alcohol industry. Consumers flocked to online ordering options, and now that they realize how convenient it is, demand is expected to continue climbing.

E-commerce was big for us in fiscal 2021 – both direct to consumer from our winery and distilleries and through our customers’ online platforms. We’ve now established a dedicated team to capitalize on the e-commerce trend and partner with our customers to develop their online consumer interactions and omnichannel strategies.

Corby has an outstanding portfolio to win in the cocktail occasion and we’re rolling out a full slate of innovations to strengthen our position.

Building on our achievements

While we’re pleased with our 2021 financial performance, which saw revenues increase by 4% to $159.8 million and net earnings improve by 15% to $30.6 million, we’re very much focused on the year ahead. We want to build on our achievements – the details of which are provided in the Our Strategy section of this report – to accelerate profitable growth and market share.

Our portfolio strategy takes a consumer-centric approach aimed at making key moments of consumption meaningful and memorable. The Our Brands section of this report highlights the brands we’re establishing at the heart of convivial moments.

While most of our sales are through traditional retail channels, the pandemic has given rise to or advanced opportunities in e-commerce and in the on-premise and grocery channels. Having strengthened relationships with key on-premise and grocery accounts over the past year, we’ll look to make further inroads – supporting restaurants and bars as they recover from the pandemic and ensuring that we’re leading with priority brands in grocery and convenience outlets.

Export continues to provide an opportunity for value growth. Our primary focus is the US market, where Canadian whisky is the top imported whisky category, ahead of Scotch and Irish. We enjoyed solid growth in the US in 2020, and had continued success with Lamb’s Spiced rum in the UK.

Underpinning everything we do will be a continued focus on our people agenda and our data and digital transformation, which are critical enablers of our business strategy.

We want to build on our achievements to accelerate profitable growth and market share.

Heartfelt thanks

I’d like to thank our shareholders for your support during an extraordinary year. We were pleased to maintain a dividend in line with our generous dividend policy, with payments made at 90% of the prior year’s net earnings.

I’d also like to thank our Board of Directors for your guidance and support throughout the year, giving special mention to Robert Llewellyn, who retired from the Board in August after many years of service, and to Paul Holub, who resigned from the Board in May following his retirement from Pernod Ricard North America.

We’re privileged to have Helga Reidel, President and CEO of Enwin Utilities Ltd., and Lani Montoya, Senior Vice President, Human Resources, Pernod Ricard North America, join our Board. Helga and Lani bring extensive business and industry experience to Corby, and we look forward to working with them both as we pursue our goal of leading growth within the Canadian spirit and wine market. As of September 1, women make up 44% of our Board and 51% of our workforce.

Finally, cheers to the moments when we can finally get together. In my first year at Corby, most of my meetings with employees, customers, shareholders and others have been virtual. I look forward to the day when we can meet in person and toast new beginnings.

Sincerely,

Nicolas Krantz

Nicolas Krantz
President & Chief Executive Officer