ITALY: Gruppo Campari's top-line to accelerate over FY - analyst
Campari's H2 is expected to be better than H1, according to Nomura
Gruppo Campari can expect to see an acceleration in its top line this year and will remain on the acquistion trail, an analyst has forecast.
Last week, the Milan-headquartered drinks group reported a moderate rise in H1 profits, helped by its sales in the Americas. However, European sales, excluding Italy, saw a 2.1% sales drop.
But analysts Nomura said the toughest half of the year is now behind the firm. "We expect an acceleration in the top line and see better reporting through the year," Nomura said in a note released late last week.
Italy accounts for around 30% of Campari's sales and the macro market is likely to remain "volatile", the analysts warned, but added: "The shape of the company’s spirits portfolio in Italy offers some protection, given exposure to the faster-growing aperitif market."
Nomura also said that Campari's balance sheet offers M&A opportunities. "We believe Campari will remain an active consolidator in the sector," the note said.
"Given its (Campari's) record of buying undermanaged assets and not overpaying, we see further value creation from potential acquisitions."
In 2009, Campari acquired the Wild Turkey Bourbon brand from Pernod Ricard. The purchase was followed a year later with a move for liqueur brands Carolans, Frangelico and Irish Mist from William Grant & Sons.
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