Troubled ASX-listed brewer Broo announced last Friday afternoon that it had narrowed its operational losses in the last quarter.

After a series of cost cutting measures, Broo lost just $91,000 in the three months to December – an improvement on the $290,000 loss of the previous quarter.

However, the brewer had just $71,000 in the bank at the end of the period, with a projected cash outflow for the next quarter of $805,000.

In the three months to December Broo generated $583,000 in revenues, but spent $674,000, including $150,000 on operational and manufacturing costs, $153,000 on staffing and $319,000 on administration and corporate costs.

The results appear to show last year’s heralded Queensland distribution deal is yet to have an impact on its bottom line.

Under the distribution deal announced last August, Bundaberg-based East End Hotel Group was forecast to sell 2 million litres over the following 12 months.

Despite Grogan promising the deal would “accelerate Broo’s sales growth’, revenues for the last quarter were $400,000 lower than for the same quarter last year.

A much-lauded Chinese distribution deal which Broo signed in 2017 and the company insisted would net them $120 million over seven years, is due to bear fruit towards the end of 2020.

Share sales keep company afloat

As has become routine for the brewer, just prior to Broo announcing its quarterly results it advised that it had issued more shares, raising $500,000 to provide the company with ‘working capital’.

Last week as it announced its current results, the Mildura-based brewer further applied to issue 15,000,000 unlisted options with an exercise price of $0.02 per option, exercisable until January 8, 2022.

Broo explained in an ASX filing the securities were issued in consideration for “commercial services” provided to the company.

New CFO buys Founder’s shares

In addition to the company’s regular share sales, founder Kent Grogan sold $980,000 worth of shares in an off-market sale announced to the ASX on Christmas Eve.

Broo also announced on Christmas Eve that Adrian Siah has been appointed as the chief financial officer (CFO). The announcement described Siah as “an experienced finance executive who has previously worked in senior roles in commercial management and investment banking.”

On 8 January, Broo advised the ASX that Gem Syndication Pty Ltd has become a substantial shareholder. The purchase gave Gem Syndication 8.61%, of the company at $0.016 per share.

ASIC records show that Gem Syndication Pty Ltd is owned by another company CEA Syndication Pty Ltd, with Teik Leong Siah listed as a director. The Australian Business Register records Adrian Siah as the trading name of Teik Leong Siah.

Mr Siah has been registered as a licenced estate agent in Victoria since 2014, and is listed as an agent at a number of Melbourne-based property firms, including Gem Realty and red23 Real Estate. His agent profile describes Siah as “a career accountant turned real estate professional”.

“He is a numbers man who loves meeting and talking to people about property, houses and all things real estate. With a background in accounting, investment banking and developing, Adrian’s transition to the real estate industry was a natural one,” the profile says.

While Mr Siah’s company bought shares from Grogan at $0.016 each, the notice advising of Mr Siah’s hiring also announced Broo sold 50,000,000 shares to a “professional and sophisticated investor” at an issue price of $0.01 per share, raising $500,000, less costs, for the company.

Contacted by Brews News on the number listed on his agency page, Mr Siah confirmed his appointment to Broo, though advised it was “not a good time” to chat. He advised he would call back, though Brews News has yet to hear from Mr Siah who has failed to respond to further texts or calls.

Kent Grogan didn’t respond to requests for comment.

Broo shares are currently trading at $0.016.

Additional reporting by Matt Kirkegaard.