CHILE: Exports drive impressive quarter for Concha y Toro
Growth in its premium wines and strong export growth have helped Vina Concha y Toro report a 70.4% rise in net income for the second quarter to CLP8.77bn (US$16.7m). Earnings per ADR increased 79.6% to US$0.46 for the quarter.
For the quarter, total revenues increased 22.3% to CLP68.25bn, the wine company said today (8 August). The main drivers behind the lift were the strong quarter for exports across all regional markets and a good result from the UK subsidiary.
"The results achieved by our export business quarter-to-quarter reflect the company's competitive positioning and the strength of its brand worldwide," said Eduardo Guilisasti, CEO.
"With strong growth in most of its markets (in US dollar terms), exports grew 32.4% in the quarter and 38.5% in the first half of the year. The company has shown growth diversified by markets with contributions from all its subsidiaries. We think that one of our greatest achievements in this period is the progress of the premium category, led by our global brand Casillero del Diablo, with an increase of over 40% year on year. This has led to a better mix and a higher average price," he said.
Valued sales on the Chilean domestic market, however, decreased by 4.3% in the quarter and by 2.2% during the first half, reflecting "a very competitive market with flat domestic consumption", Concha y Toro said. The company added that it has been able to increase its volumes, particularly in the premium category, but the fall in the average price offset that expansion.
As a result of solid export growth, a better mix and a lower average direct cost, operating income rose 69% to CLP12.33bn in the second quarter. The operating margin increased by 500 basis points to 18.1% on a quarterly basis and to 16.7% in the first half.
German wine group Racke has announced plans to increase its focus on Latin American markets, appointing an export director specifically for these markets....
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