just On Call - Gruppo Campari upbeat on US spirits
Gruppo Campari CEO sees growth in the US
The CEO of Gruppo Campari has hailed a resilient performance in the key US market, but he warned that pricing in the country's spirits sector will remain competitive.
Campari's share price rose by 3% after the firm announced another strong rise in sales and profits today (11 November). Momentum from the first half of the year has largely continued, with nine-month sales up by 14% to EUR794.9m (US$1.1bn) and pre-tax profits up by 17% to EUR156.3m, versus the same period of 2009.
Strong gains in Brazil and with Aperol in Central Europe stood out in the numbers, but the Italy-based group's CEO, Bob Kunze-Concewitz, also pointed to a resilient performance in the key US spirits market. He said on a conference call that the US market was "improving from a consumption standpoint".
Kunze-Concewitz told just-drinks that pricing in the US would "remain competitive" for the forseeable future, but he said that Campari is content with its current performance. "We're going to keep doing our own thing," he said.
The US contributed to 23.2% of Campari's net sales for the first nine months of 2010, compared to 22% in the same period of 2009. The Italy-based firm's US sales rose by 6% in value for the period, excluding exchange rate gains and the contribution of recently-acquired Wild Turkey Bourbon. If these are included, Campari's US sales increased by 21% for the nine months, to EUR184.4m.
Several analysts said that the drinks sector would be buoyed by Campari's nine-month figures, both in the US and elsewhere. "Today's results confirm the resilience of Campari's operating model," said Evolution Securities, in a note.
Evolution said that US spirits sales declined for Campari in the third quarter, but it said: "Although US Q3 sales were lower, this reflected very tough comps."
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