ITALY: Campari sales and profits up in Q1
The Campari Group has seen a modest growth in its first quarter sales, although the performance led to a more impressive increase in other profitability indicators.
For the first quarter, group sales stood at €152.6m, an increase of 0.9%. This was the combined effect of organic growth of 1.7% and a negative exchange rate effect of 0.8%.
Trading profit increased by 6.1% (+7.3% at constant exchange rates) to € 46.2m, or 30.3% of sales. EBITDA rose by 7.9% (+9.3% at constant exchange rates) to € 37.6m, or 24.6% of sales.
The group profit before taxes was €20.0m, an increase of 7.1% (+8.8% at constant exchange rates).
The company said that its spirits segment, which accounted for 66.0% of total sales, recorded growth of 3.3%, following organic growth of 4.4% and a negative exchange rate effect of 1.1%.
The Campari brand saw its sales fall by 4.6% at constant exchange rates (-4.9% at actual exchange rates), due both to an unfavourable comparison with the same period of last year and to a reorganisation of the distribution system in Austria and Russia, which triggered a temporary drop in sales to the distributors in those markets. Sales in Campari's main markets were positive overall.
Sales of SKYY Vodka, including the flavours, grew by 14.6% at constant exchange rates (9.8% at actual exchange rates), thanks to a positive performance in both the US (+9.6% at constant exchange rates) and on the international markets (in excess of 50% at constant exchange rates).
As regards to its other main brands, the company said the spirits segment was boosted by good growth from Aperol (+11.5%), the Brazilian brands (+50.4% at constant exchange rates) and Cynar (+31.6% at constant exchange rates). CampariSoda saw its sales decline by 0.3%, while Ouzo 12 sales dropped by 33.0% following a reduction in stocks by distributors in Greece in anticipation of the launch of a new packaging. Sales in the spirits segment also benefited from the positive performance of the brands under licence tequila 1800 (+8.1% at constant exchange rates) and Jägermeister (+14.3%).
The wines segment, which accounted for 13.2% of total sales, recorded growth of 0.3%, following organic growth of 0.9% and a negative exchange rate effect of 0.6%. Cinzano sparkling wines saw their sales fall by 9.3%, while Cinzano vermouths posted growth of 21.7% at constant exchange rates, thanks to good sales in Italy and the main European markets. Wines also benefited from a solid performance from Mondoro and Riccadonna, while sales by Sella & Mosca slid by 12.3%.
Soft drinks (19.8% of total sales, almost entirely on the Italian market) saw their sales fall by 4.4%. Crodino sales declined by 0.5%, owing to an unfavourable comparison with the same period of last year. Sales of the Lemonsoda, Oransoda and Pelmosoda range dropped by 14.3%, while Lipton Ice Tea sales dipped by 3.7%.
By region, Campari said that the Italian market (which accounts for 57.3% of total Group sales), posted organic growth of 1.3%. This was due to a good performance from Campari and the other main spirits, combined with a slight dip in wine sales and a more marked fall in sales of soft drinks and Campari Mixx. Sales in Europe fell by 6.8%, mainly because of the reorganisation of the distribution system in Austria and Russia, which triggered a temporary drop in sales to the distributors in those markets.
In the Americas, which account for 22.8% of total sales, the US market posted growth of 3.4% at constant exchange rates, which was completely wiped out by negative exchange rate movements (-4.7%), while sales in Brazil grew by 37.5% in local currency terms. Sales to the rest of the world, accounting for 2.7% of the total, saw organic growth of 16.9% at constant exchange rates, thanks in particular to a positive performance from the Australian market.
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