Analysis - Constellation Brands ready for Crown Imports price hike
Constellation took over the Crown portfolio last month
Constellation Brands is poised to accelerate pricing on its Crown Imports labels after first-quarter results showed the recently-acquired beers in rude health, an analyst has said.
The Crown portfolio, which Constellation acquired full-control of from former JV partner Grupo Modelo last month, saw sales increase by 5% in yesterday's Q1 figures. An announcement of a bigger marketing spend for the rest of the year was also “a sign of confidence” in the brands, Stifel's Mark Swartzberg said today (3 July).
Swartzberg added that pricing for Crown Imports beyond the 2% taken last year “may be imminent”.
“We believe pricing in-line with Anheuser-Busch InBev's 3% to 4% rate increases is likely long-term,” Swartzberg said.
Swartzberg also reiterated his view that pressure to promote and innovate in wines and spirits will continue to erode the categories' EBIT margins until at least the end of fiscal-2016.
The Crown Imports deal, which gives Constellation perpetual US rights for the Modelo brands, makes the company the third-biggest brewer and beer seller in the US market. It also gave it ownership of a Modelo brewery on the Mexico-US border.
For a full round-up of just-drinks' coverage of Constellation's Q1 results, click here.
The final just-drinks management briefing of the year takes a look back at the last 12 months in the global drinks industry. The penultimate chapter in this five-part briefing reviews 2013 for wine....
The world’s second largest wine producer, Constellation Brands transformed its alcoholic drinks operations with the acquisition of Modelo’s US beer business in 2013. This profile considers strategies ...
With the end of the year looming, just-drinks is running a series of 'Top Tens of the Year' in the run-up to Christmas. Here are the ten most read news stories on just-drinks in 2013....
Global Wine industry profile provides top-line qualitative and quantitative summary information including: market share, market size (value and volume 2008-12, and forecast to 2017). The profile also ...
With the end of the year looming, just-drinks is running a series of 'Top Tens of the Year' in the run-up to Christmas. Here are the ten most read Hot Topics on just-drinks in 2013....
Frigorífico Modelo SA is engaged in a wide range of activities, including the production of fruit/vegetable juice; however, this is not the company’s main focus. In terms of its fruit/vegetable juice ...
- Comment - Diageo Steps Up Defence of Haig Club
- Focus - Diageo's H1 Results by Region, Brand
- Comment - Spirits - Where Next for Scotch Whisky?
- just the Preview - Diageo Q2 & H1
- just the Facts - Top 20 US Beers by Value, Volume
- Belvedere vodka tie-up over new James Bond film
- Diageo speaks out over supplier contract changes
- Brown-Forman appoints Jack Daniel's president
- ASA rejects Haig Club ad complaints
- Carlsberg freezes Russia salaries, new hires
- Global RTD/RTS insights - market forecasts, product innovation and consumer trends research
- Diageo plc (DGE) - Financial and Strategic SWOT Analysis Review
- Edrington Group in Spirits (World)
- Global Consumer Trends and Key Consumer Targets in Alcoholic Beverages
- Global vodka insights - market forecasts, product innovation and consumer trends research