The IWSR Cognac and Brandy in China Report
Comprehensive report including consumption broken down local v imported, by country of origin and brand, on- and off-trade splits, distributor information, 2010 forecasts and pricing information.
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Finally, things look to be hotting up in 2011.
The French press is buzzing today (24 January) with reports that Champagne houses LVMH, Nicolas Feuillatte and Lanson BCC are set to slog it out in auction for Remy Cointreau's Champagne business. Meanwhile, reports out of Australia suggest that SABMiller is picking through the details ahead of making a bid for Foster's Group's beer business, Carlton & United Breweries. And, in soft drinks, Japan's Kirin Holdings has announced a major push into China's soft drinks market. More signs, then, that this year could see an increase in M&A activity.
(As an aside, earlier today I met with Stella David, CEO of William Grant & Sons, a company which dominated the M&A headlines in spirits last year. Eyes front for our interview, which will appear later this week.)
Back to last week, and both Remy and SABMiller issued strong third quarter trading updates. For the French wine and spirits group, China's thirst for expensive Cognac is fuelling both sales and profits. Remy's strategy is clearly to focus most of its resources on Asia, but could this carry risks at a time when China's economy looks vulnerable?
SABMiller's global beer sales, meanwhile, are improving and analysts believe that the brewer may achieve higher profits than originally expected for its full-year, to the end of March. However, the Americas remains a weak spot for the brewer. It will be keen to turn volumes around there, considering that North and Latin America are expected to account for close to 50% of operating profits this year. After all, one cannot rely on cost savings forever.
Features-wise last week, spirits know-it-all Richard Woodard began his year with a timely grizzle about how depressed he was, and how it was all your fault, spirits-folk. Ben Cooper, meanwhile, headed to Finland to see how the authorities there are looking to target brewers and soft drinks producers with tax rises this year. The Baltic state of Estonia, just across the water, could be the main winner, however.
Until next time...