This week, Top Shelf International – the company behind Act of Treason Agave – published its final financial results for FY24, showcasing an underlying EBITDA improvement of 51% when compared to the year prior. In these results, Top Shelf noted that Act of Treason Agave sales had “exceeded initial expectations.”
These results fell shortly behind the news that the first commercial agave crop had been planted in South Australia. The project, which is being led by plant-based technology company Vircura in collaboration with The Madgett’s Block farm, is being touted as an opportunity for currently struggling grapegrowers to exit the grape and wine sector.
According to Vircura’s General Manager, the planting of Agave could present an opportunity to winegrowers currently looking to exit the region.
“Agave could provide a new direction for many grape growers who want to stay in agriculture but are questioning their future viability or wanting to diversify,” said Adam Djekic, Vircura’s General Manager.
“Tequila is one of the fastest growing spirits popularity-wise internationally, and it is an industry which could grow significantly in Australia over the coming years.”
Trent Fraser, CEO at Top Shelf International, recognises that Act of Treason Agave, which sold out of its debut release within a day of being released to market, is steadily gathering momentum.
“Although Act of Treason Australian Agave is only in its infancy, it has already won Gold medals at two of the most prestigious global spirit competitions, namely the San Francisco World Spirits Competition, and the International Wine and Spirit Competition in London, UK,” he said.
Act of Treason recently attained nationwide distribution via Endeavour Group’s two retail banners, reflecting the significant investment that Top Shelf International has put into its Queensland Agave brand. Over the past financial year, Top Shelf International invested $6 million into its Australian Agave program, or almost two thirds of its overall $9.3 million spend, adding to the $7 million it invested into Agave in FY23. In April, the pressures of this investment forced the ASX-listed company to announce a $5 million sale and leaseback deal on its Eden Lassie agave farm to help combat debt: “Proceeds from the proposed sale, after transactions costs, will used by the Company for working capital purposes, including for further reduction of debt,” read its announcement to investors at the time.
“In addition to a reset of the economic model in FY24, a critical focus has been to accelerate domestic major retail and range expansion,” added Trent Fraser this week.
“Major retail distribution point growth in excess of 40% during FY24 in a highly competitive environment is testament to the Top Shelf team and quality of our brand portfolio.”
Vircura’s South Australian project saw 1,200 blue agave plants plants which will take between three and six years to fully mature. Oli Madgett, who Co-Owns The Madgett’s Block alongside Tara Madgett, said that Agave presents a logical option as they require less maintenance, lower water requirements, and zero pesticide use when compared to other crops such as grapevines.
“We were looking at what we could do with our land and how we could make it sustainable,” he said.
“Wine grapes have relatively high inputs and our vines were A-grade, which meant we were hand-pruning and picking and watering. Having a three to six-year growth period with agave allows us to put all of the building blocks together and help create a strong and sustainable industry, without too many touch points.”
Vircura Chief Scientific Officer Rachel Burton added: “by growing crops in South Australia and showing the agricultural community that it’s a hardy plant which grows well here, we might encourage others to join an emerging industry where there are significant opportunities.”
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