Campari to avoid M&A as Q1 sales drop
Italian firm Campari Group saw organic sales drop by 4.2% in the first quarter and confirmed it would streamline its portfolio and not seek further acquisitions.
The Milan-headquartered group noted a ‘soft start’ to this year with sales falling to €666 million (US$750m) in the first quarter (Q1).
The first-quarter performance followed a full-year organic sales increase of 2.4% for the Aperol maker in 2024.
Campari Group CEO Simon Hunt said this softer Q1 performance had been expected due to “heightened macroeconomic volatility in our smallest and lowest seasonality quarter” along with the timing of Easter in the Europe, Middle East and Africa (EMEA) region, and logistic delays in the US.
However, it highlighted a ‘sell-out performance’ compared with the wider spirits market in most regions, with a ‘strong bounceback’ in April.
Hunt said the company would continue its cost containment programme and “pricing discipline”, and confirmed it would not be seeking acquisitions but would commit to “streamlining the portfolio” through deleverage.
Last month US president Donald Trump unveiled a global tariff plan by which all counties would be subject to a baseline 10% tax, but this was paused for 90 days. The EU was among several regions to be hit with a steeper rate, set at 25%.
Campari Group expects US tariffs to cause a negative impact of approximately €25m (US$28m) on its earnings before interest and tax (EBIT) in 2025, before possible mitigation actions.
The group previously estimated US tariffs could hit the business by up to €100m (US$106m).
Hunt added: “We are maintaining a prudent approach given the current uncertain operating environment, affected also by tariff threats.”
He stated that the group’s previous 2025 guidance announced in March would remain its target.
In the medium term, Campari Group said it expected to continue to achieve ‘mid to high single-digit organic net sales growth’.
Geographical performance
All regions, except Campari Group’s smallest (Asia Pacific), declined during the first quarter.
The Americas (the group’s biggest region with 47% of sales) reported a 6% drop, with sales down by 11% in the US but up by 5% in Jamaica.
Its decrease in the States was attributed to ‘high volatility’ and the threat of tariffs, which led to destocking, mainly for Skyy Vodka, Grand Marnier and Wild Turkey Bourbon, as well as logistic delays (excluding the latter, the decline would be 5%).
The EMEA region posted a 4% decrease, with Italy and Germany down by 3% and 10% respectively. France fell by 2%, however the UK rose by 10%.
Sales in Asia Pacific grew by 11% with Australia soaring by 16%, led by ‘excellent execution’ in apéritifs at the Australian Open and an ‘accelerated focus’ on on-trade activations.
In April, Campari Group agreed to sell its sole production facility in Australia as part of its strategy to focus on the firm’s core brands. The site was mainly used to produce the group’s ready-to-drink brands.
All brand houses in decline
The firm’s largest division, House of Apéritifs (44% of group sales), was down by 1% with a ‘flat performance’ for Aperol – although the brand posted 8% growth in the Americas. Campari decreased by 5%.
The House of Whiskey and Rum dipped by 2%. Wild Turkey had a ‘soft performance’ in its core US market, while the Jamaican rum portfolio rose by 5%.
The group’s agave spirits portfolio (known as House of Agave) also decreased by 2%. Espolòn was down by 5%, driven by the US and a decline in blanco, which was partially offset by ongoing growth in Reposado (up by 5%).
Campari’s other agave brands soared by 29%, driven by Montelobos mezcal and Ancho Reyes liqueur in the Americas, as well as the Espolòn RTD in Australia.
The ‘House of Cognac and Champagne’ decreased by 13%, driven by a 12% drop for Grand Marnier liqueur because of logistic delays, destocking and a focus on pricing in the States.
The group’s other Cognac and Champagne brands registered a 22% decrease, mainly impacted by Bisquit & Dubouché Cognac in South Africa.
Campari acquired Courvoisier Cognac from Suntory Global Spirits for US$1 billion in May last year.
Courvoisier, which will be included in the group’s organic growth from May, recorded €32m (US$36m) in net sales with progressive investment in the US and UK. The company noted that it had not defined its plan for Asia Pacific, which it called a ‘volatile’ market in the wake of China’s anti-dumping investigation on EU brandy.
The firm’s local brands posted a 9% drop with Skyy Vodka falling by 8% due to category challenges in the US.
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