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How did Concha y Toro perform in Q1 2019? - results data

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  • Reported first-quarter sales climb 5% to CHP130.7bn (US$184.7m)
  • Wine sales in three months to the end of March up 10.2%
  • UK, Brazil and Mexico drive export sales rise of 12.9%
  • Casillero del Diablo jumps double-digits in value and volumes
  • Termination of Diageo distribution deal in Chile pulls on top-line

Concha y Toro has started 2019 well, with first-quarter sales increasing at a similar rate to that posted from the same period last year.

The Chile-based wine group, which also acts as a third-party distributor in its home market, said late last week that sales in the three months to the end of March were up in reported terms by 5%. The performance echoed the 5.1% top-line lift in the corresponding quarter last year, albeit Q1 2018's rise was on a constant-currency basis.

Concha y Toro 2019 - Sales versus 2018 - Reported

Source: Company results

The 10.2% lift in the company's wine sales came on the back of a near-13% jump in exports. The top-line was hampered by Diageo's switch of Chilean distributor from CyT to the Coca-Cola system during the second quarter of last year.

Flagship wine brand Casillero del Diablo enjoyed the quarter, with sales by value and volumes climbing 15% and 10%, respectively.

Concha y Toro Q1 2019 - Sales by Region

Chile - Domestic (Wine)Exports (inc. sales from dist'n subsidiaries)Argentina - DomesticArgentina Exports(ex sales from dist'n subsidiaries)The US (Fetzer) - DomesticThe US (Fetzer) Exports (ex sales from dist'n subsidiaries)Total
Q1 2018152407067011861999197472226124442
Q1 201916178798158462055208262672130686

Source: Company results

(Concha y Toro's distribution subsidiaries comprise the UK, the Nordics, Brazil, Singapore and Mexico)

In Europe, CyT's largest reporting region, first-quarter sales jumped 14.2%, as the UK chipped in with a 29% leap in value terms. A "challenging scenario" in the group's domestic wine market saw sales at home rise 6.2% on a 1.3% volumes decline.

Over in Argentina, where CyT owns the Trivento brand, the ongoing withdrawal from "products with a low profitability" coupled with macro-economic conditions hit domestic sales hard. Argentinean exports, meanwhile, were up by just under 3%.

Sales in the US were strong, with the group reporting a 5.5% increase on a near-19% volumes fall. CyT flagged that the "integration process" of US imports from its Chile and Argentina operation dragged on volumes but lifted the average price in the country. Exports from the US business, comprising California's Fetzer Vineyards, were up an impressive 20% year-on-year.

CEO Eduardo Guilisasti

"In the first quarter of the year, we have continued to make progress following our new commercial strategy guidelines, with focus on value and profitability growth.

"A positive performance was recorded by such markets as the UK, Brazil and Mexico, where the integration of the distribution business has favoured the execution of the new commercial strategy and strong growth in sales. In the domestic market of Chile, ... we highlight the positive performance of the premium category, which was driven by Casillero del Diablo brand and its upper brand extensions."

To read Concha y Toro's official Q1 2019 results statement, click here.

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Sectors: Company results, Wine

Companies: Concha y Toro

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