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Allied Domecq has announced that trading for the first four months of its current financial year has been strong in most areas of the business. The company has warned, however, that its profits could be hit by as much as £25m if the dollar remains at its current rate for the rest of the financial year. Notwithstanding this, Allied Domecq said it is on track to deliver good earnings growth in the current financial year.

The performance of the spirits portfolio has been robust, the group said. The nine core brands have delivered growth in both value and volume of over 6% supported by growth in advertising and promotion as predicted at the close of the last financial year.

The Spanish market has substantially recovered from the change in wholesaler buying patterns experienced by the industry last year. Both Ballantine's and Beefeater have gained further share in this market supported by increased brand investment.

Elsewhere in Europe the economies remain challenging, but Ballantine's has gained market share in both France and Germany.

The North American business has performed strongly and gained market share from competitors. These positive performances have more than offset weaker trends in Mexico and Asia Pacific, in particular Korea.

The wine portfolio has continued to deliver good revenue and profit growth due to the group's strategic focus on product mix at the premium end, despite the anticipated decline in volumes of table wines from Spain.

Results from the Quick Service Restaurant division are very strongly ahead, AD said. These reflect the impact of the increased pace of new store openings over the past twelve months, product innovation driving same store sales growth in Dunkin' Donuts, and a lower cost base following the restructuring of the business at the end of last fiscal year.


Sectors: Spirits, Wine

Companies: Allied Domecq, Ballantine’s

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