Campari confirms strong year-to-date sales

29th October, 2019 by Nicola Carruthers

Italian drinks firm Campari Group has reported “positive momentum” in the first nine months of 2019, driven by apéritif brand Aperol and its brown spirits portfolio.

Aperol grew by double digits in its three largest markets – Italy, Germany and the US

The drinks group’s reported sales grew 8.6% to €1.3 billion (US$1.44bn) after the exchange rate and perimeter effects. Gross profit increased by 10.5% to €808.6 million (US$896m).

Campari said it had witnessed a “strong” third quarter boosted by its “high-margin apéritifs business despite a tough comparable base and adverse weather conditions in northern Europe”.

“Key underlying profitability indicators grew ahead of organic sales development, thanks to a very positive sales mix, which helped offset the dilutive impact generated by the agave cost and the emerging markets sales recovery, as well as favourable phasing effects in the third quarter,” said Bob Kunce-Concewitz, CEO.

“The outlook remains unchanged and fairly balanced in terms of risks and opportunities on a full-year basis. We remain confident in delivering a positive performance across all key underlying business indicators.”

Global priority brands registered “strong” organic growth of 8.2%, despite the “low-single-digit” decline (-2.6%) of Skyy vodka “due to persistent competitive pressure in the US market and the continued destocking mainly affecting flavours which are down double-digit”.

Grand Marnier liqueur fell 4.3% “due to phasing in Q3 in the core US market, despite positive sell-out trends”.

The segment was bolstered by the “positive performance” of Aperol (+21.8%), which witnessed double-digit growth in its three largest markets ­­– Italy, Germany and the US – as well as “other high potential markets”.

Campari apéritif was up 5%, driven by core markets, while Wild Turkey Bourbon grew 6.7% thanks to the US and Australia.

The Jamaican rum range increased 6.2% thanks to Wray & Nephew Overproof (+13.8), which benefitted from “solid trends” in its core Jamaica, US and UK markets. Appleton Estate rum was “flattish overall due to temporary weakness” in Canada.

Campari’s ‘regional priority’ brands grew by 5.3% as a result of the “very positive performance” of Espolòn Tequila, which was up 24.9%.

Regional performance

Geographically, sales in the Americas grew organically by 6.5%, with North America growing by 6%. Jamaica increased sales by 17.3% thanks to the rum portfolio and Campari.

Sales in Southern Europe, Middle East and Africa witnessed an organic growth of 8.1%, boosted by Italy (+8.4%).

North, Central and Eastern Europe sales saw an organic change of +8.3%, led by Germany, the UK and Russia.

Asia Pacific grew sales by 0.9%, with the region’s largest market, Australia, growing by 3.7%.

During the period, Campari signed an agreement with Chevrillon Group to buy French firm Rhumantilles, owner of the Trois Rivières and Maison La Mauny agricole rum brands in September.

This was followed by the purchase of a controlling stake in Montelobos mezcal and Ancho Reyes liqueur for US$35.7m a month later.

The Italian group also agreed to sell its Villa Les Cèdres mansion in France for €200m (US$220.6m) as part of the firm’s divestment of non-core assets related to the Grand Marnier liqueur acquisition.

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