US: US shipments hinder Beam Global in Q1
Fortune Brands has posted sliding sales and operating income for its first quarter, as the poor economic climate in the US hit home product sales.
The company's drinks arm, Beam Global Spirits & Wine, also had a tough quarter with sales and operating income dipping slightly on a year earlier.
The US group said today (24 April) that total sales in the three months to the end of March were down by 5.4% on the corresponding quarter a year earlier at US$1.81bn. Group operating income dropped more markedly, by 11.4% to $227.2m.
Net income, however, was up, albeit marginally, by 0.2% at $120.5m.
Over at Beam Global, net sales in the quarter were down by 0.8% to $515.3m, with operating profit falling by 1.8% to $128.6m.
Fortune's president and CEO, Bruce Carbonari, said that Beam Global had seen spirits shipments in the US in the quarter impacted by "larger-than-usual seasonal reductions in distributor inventories that don't reflect the health of our brands in the marketplace".
"Had distributor inventory movements been consistent with the prior year, our worldwide spirits sales would have been solidly higher," Carbonari said.
"Strong growth" was reported in the UK, Spain and Germany, as well as in Russia, India and China. "We sustained the double-digit increase in brand spending we began in the third quarter of 2007, and we believe the brand-building campaigns we launched over the past several months for Sauza, Canadian Club and Courvoisier are helping each of these brands accelerate growth," Carbonari said.
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