Why the Gage Roads Brewing Co Limited (ASX:GRB) share price is up 4% today

The share price in craft beer company Gage Roads Brewing Co Limited (ASX:GRB) is up 4.35% to 12 cents following the announcement of a supply contract win.

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Beer, cheers, pub, drink

The share price in craft beer company Gage Roads Brewing Co Limited (ASX: GRB) is up 4.35% to 12 cents in Monday trade following this morning’s announcement that it has won a contract to be the exclusive supplier of beer and cider at Perth’s nib Stadium.

The stadium plays host to A-League club Perth Glory, rugby teams and high profile concerts. The supply contract will allow the exclusive sale of Gage Roads draught and packaged products at nib Stadium for 5 years from August 27, 2018.

Gage’s share price has risen 161% over the last 12 months with the company’s recent quarterly showing it generated $2.9 million in operating cash flow for the June quarter. The company also announced that unaudited EBITDA for FY18 was up 28% over the prior corresponding period to $4.5 million. A key driver of revenue growth is sales to independent retailers which jumped 181% in FY18.

Overall, it’s been a fantastic 12 months for investors in listed liquor merchants with Gage and others such as Australian Vintage Group (ASX:AVG) and Treasury Wines Estate Ltd (ASX:TWE) all delivering returns of over 30%, comfortably beating the return of the broader Australian share market.

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Motley Fool contributor Tim Katavic has no financial interest in any company mentioned. The Motley Fool Australia has recommended Treasury Wine Estates Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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