Beam raises bar as sales soar

Beam, the owner of bourbon brands Maker’s Mark and Jim Beam, saw sales increase by 8% year-on-year in the first half of 2012.

Beam’s Power Brands: Courvoisier, Jim Beam and Maker’s Mark

The group, which announced a 5% net sales increase in its Q2 results yesterday, attributed a third of the half-year growth to sales of new product innovations.

While its ‘Power Brands’ delivered strong growth figures for the half-year, up by a total of 12% on 2011, its ‘Rising Stars’ portfolio delivered exceptional results.

Skinnygirl sales grew by 81% over the past six months from January to June 2012, with the newly-acquired Kilbeggan Irish whiskey up 71% and Basil Hayden up 33%.

“Beam continued its momentum with quarterly results that exceeded our expectations, even as we lapped a very strong year-ago quarter that was boosted by our 2011 new product launches,” said Matt Shattock, president and CEO of Beam. “Sales in North America were particularly strong, while the top line in our EMEA and APSA regions in the quarter was adversely impacted by the timing of sales. Beam’s profits grew faster than sales, and earnings per share grew at a solid double-digit rate.”

As a result, Beam has announced it will raise its 2012 earnings target to a ‘low double-digit rate’, up from a previous target range of high singe digits.

Investment

Taking a cue from the strong growth results of its leading players, Jim Beam (11%), Maker’s Mark (29%) and Courvoisier (21%), Beam now intends to focus its strategy for the second half of 2012 on meeting increasing global demand for Scotch, bourbon and Cognac.

“We intend to make stepped up investments in two key areas to fuel our momentum and further enhance our prospects for long-term profitable growth,” added Shattock. “First, we will upweight marketing investment in the second half behind our most exciting brands and innovations; and second, we are accelerating investment to lay down more aged spirits to support future worldwide demand for our Bourbon, Scotch and Cognac brands.”

As such, Beam intends to expand its distillation and warehouse capacity and will also open its new Global Innovation Centre in Kentucky at the end of the year.

There were no reported figures in the update for Pinnacle vodka, the brand Beam acquired from White Rock Distilleries in April this year.