In Pat Rigney’s business, distilling premium spirits, cash is king. “It’s more important than profit,” he says, as we sip coffees in the restaurant at his Shed Distillery in Drumshanbo, Co Leitrim.
“Interest rates are high, money is expensive and you’ve got to pay it back.”
The modern and smartly-appointed distillery makes the hugely popular Drumshanbo Gunpowder Irish Gin and Drumshanbo Single Pot Still Irish Whiskey. There is also a vodka product and plans for a rum drink next year.
Rigney has just invested €2 million into new kit to expand the distillery’s capacity, with its bottling facility being relocated to make room for the shiny new equipment. Working capital needs over the next five years will be “at least” €10 million, he adds, as it seeks to build up its stocks of Irish whiskey.
Next week it will celebrate its 10th anniversary in a former Methodist church a short walk from the distillery that Rigney and his family bought, renovated and plan to make available for community use. They have also invested in an 80-acre farm nearby, which they are transforming into a nature reserve.
The Dubliner, who went to school at Sandford Park in Ranelagh, to college just up the road in UCD and who lives in the capital by the coast in Blackrock, is putting down firm roots in the sleepy Leitrim village.
Unlike some of its domestic peers, the family-owned Drumshanbo distillery has been consistently profitable and is debt free. In the year to the end of September 2023, it made a pretax profit of €3.8 million on turnover of €18.3 million. It closed the year with accumulated profits of €15.2 million and just under €5 million in cash.
For the most recent financial year, which closed at the end of September, Rigney says its income and profits will be slightly under those figures, reflecting some discounts that it had to put through in the period to reflect the challenges involved in its markets. In July, global drinks giant Diageo, which owns Smirnoff vodka, Johnnie Walker whisky and other brands, reported its first global sales drop since 2020, citing weak consumer sentiment.
PJ Rigney Distillery & International Brands Ltd, which owns the Leitrim distillery, was profitable in 2020 and 2021 in spite of the devastating impact of Covid-19 on the hospitality trade globally and on travel retail due to public health lockdown restrictions in many countries. Strong sales in the off-licence trade helped to keep the show on the road, along with the production of hand sanitiser for Tesco for a short period in 2020 to help satisfy the huge demand that existed at the time for products to keep the virus at bay.
Notably, this strong trading performance over the years has been achieved without a price increase since launching. No increase has been baked into its budget for next year and Rigney doesn’t expect to impose one in 2026 either.
“We’re very focused on a premium position but also on giving value for money,” he says.
How did it manage to keep prices at the same level during the huge spike in inflation and energy prices following Russia’s invasion of Ukraine in February 2022?
“We’ve become more efficient, we’ve grown our volumes,” he says matter-of-factly. “And we’re a family-owned business taking the long-term view. We don’t have to report to the stock market. We have not taken a price increase [for 2025] we will not be taking one in 2026. We need to ensure that we become more efficient and deliver real value for our customers.”
Rigney argues that the company offers premium products at “accessible” prices. A bottle of its Irish whiskey goes for €50-€60 or $60-$70, depending on taxes charged in its markets. “Consumers right now are looking for value but value isn’t always about price. It’s about the quality, the authenticity of the story behind it, the people behind it,” he says.
There certainly is a unique story behind the Shed Distillery. Rigney is a veteran of the spirits industry. On leaving college he secured a marketing graduate role with Bulmer’s cider in Clonmel. He then went to Gilbey’s Gin and then on to Carolan’s Irish Cream. From there, he worked on the Bailey’s brand where he dreamed up the twin-bottle Sheridan’s Irish Cream that, according to a profile of him by stockbroker Davy, “made the market sit up and take notice”. He later worked with Ború vodka.
The Shed Distillery was set up with €3 million of family money, he says.
He is also a major shareholder and chairman of Dalcassian, the Dublin-based wine and spirits distributor, and an investor in Changing Times Brewery, the newly launched beer-maker in Glasnevin, backed by the families behind some of Dublin’s best known pubs.
For the Shed Distillery, he wanted a location that was “wild and unmanicured, in the heart of rural Ireland”. He found it in Drumshanbo where a unit that had years earlier housed a jam factory was available to lease on a competitive deal.
Being family owned (he founded the business with his wife Denise while his daughter Roisin has relocated to Leitrim and is involved in “marketing projects” at the business) is also a part of the story that resonates with customers, he says.
Drumshanbo Gunpowder Irish Gin has been a huge success since its launch and is now available in more than 80 markets and is a top eight global brand. What makes it different from other gins?
“It’s the oriental botanicals, it’s gunpowder tea, sourced by people at the distillery and curated here ... beautifully presented. We only sell whiskey here that we distil ourselves and we want to be the best in the world at single pot still. It’s distilled here with Irish oats and it’s really outstanding quality. And we have a great distiller in Brian Taft,” he says.
How big can Gunpowder Irish Gin become?
“I think we can get to half a million cases. We’re about 270,000 now. We’ve a long way to go. It’s a big leap but I think we will get there. We might do it in the next three to four years. It’s all about sales now.”
Selling Irish whiskey into the United States might become more challenging post January 20th when Donald Trump returns to the White House. Trump has threatened to impose blanket tariffs on goods coming from Europe once back in office.
Rigney is relaxed at the prospect. “Whether that will happen or not is hard to know because it would add to inflation in the US. So it may not materialise.
“We can’t affect that, we have to play our own game and make sure that we work hard to deliver a great experience and not get distracted by all the noise out there, preserve our cash and don’t overextend ourselves and look after our team. We have to keep the business exciting and surprising. We need to stay relevant.”
The US market is “performing well” for its brands, he says. “Ireland is performing well, too. UK is okay. Our biggest challenge in a number of markets is ensuring that distributors continue to believe in our brand.
“The has been a lot of instability of the marketplace this year. High interest rates, wars, political elections and navigating through all of that. You have to focus even more on delivering a great brand experience for customers.”
Rigney insists the family will be long-term holders of the business. Some of the best local spirit producers here have been taken over by large international brands in recent years, including Teeling Whiskey, which is majority owned now by Bacardi, Tullamore Dew, which is owned by William Grant & Sons, and the Cooley Distillery portfolio of brands, now owned by Suntory Global Spirits of Japan. Pernod Ricard owns Irish Distillers, makers of Jameson whiskey, while Diageo owns Bailey’s Irish Cream liqueur.
MMA fighter Conor McGregor sold his Proper No 12 whiskey brand in 2021 to Proximo Spirits for a reported $600 million.
Not that every Irish distillery has been a success. In November, receivers were appointed over Waterford Whisky, the distillery business founded by industry veteran Mark Reynier, after it failed to raise fresh funds. There is word in the industry of other distillers pausing production due to excess stocks in the market and softening consumer demand.
At 63, you might think that Rigney would entertain a suitor waiving a big cheque and he admits there have been inquiries. But he insists that the “ultimate goal” is that this business would be here in a hundred years’ time and pass through the family.
“This brand lends itself to being a family business,” he says. “Our distribution partners are all family businesses. They have all managed to negotiate intergenerational transfers. I would hate for this place to become an after-thought for a big company.
“We are not for sale. Money doesn’t switch me on in that sense. We love what we do, we have a good standard of living, this is a lifestyle and we live it. You need to be successful but this was never about the money. We’re not thinking about flipping the business. It’s very much about making sure the brand is strong. We are emotionally connected with the business and with the town and the people here.”
For Rigney, cash, it seems, is not always king.
CV
Name: Pat Rigney
Job: Managing director and co-founder of The Shed Distillery
Age: 63
Family: Married to Denise who cofounded the business with four children. Their daughter Roisin has relocated to Leitrim to help run the business.
Lives: Blackrock, Co Dublin and Drumshanbo, Co Leitrim.
Hobbies: Travel, Sailing (racing), cycling, exploring and socialising with family.
Something we might expect: “You are always on – rarely switch off.”
Something that might surprise: Brought the Monty Python film, the Life of Brian, to UCD as auditor of the C&E (commerce and economics society) before it was allowed to be shown in Ireland.
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