Ste. Michelle Posts Flat Sales, Looks To Innovation To Spur Growth

Washington state-based Ste. Michelle Wine Estates saw net revenues slip 0.3% to $689 million in its full fiscal year 2019, with adjusted operating income down nearly 30% to $73 million. Ste. Michelle parent company Altria said higher costs and promotional investments ate into the bottom line, despite a shipment increase of 0.6% to 8.3 million cases and a premiumizing product mix.

Among Ste. Michelle’s key brands, Chateau Ste. Michelle was roughly flat at 2.3 million 9-liter case shipments last year, while 14 Hands and Columbia Crest declined 4.2% to 1.6 million cases and 6.8% to 735,000 cases, respectively. However, the company saw strong performances from other brands like Motto, Prayers of Sinners & Saints, and Drumheller, which combined for 300,000 cases.

Last month, Ste. Michelle unveiled a new innovation hub called the Elicit Wine Project, aimed at bolstering its new product pipeline. Initially, Elicit is launching three new brands targeting specific market segments. They include Liquid Light Sauvignon Blanc ($14 a 750-ml.); Fruit & Flower, comprising a Chardonnay in 750-ml. bottles ($13) as well as Sparkling, Chardonnay, and Rosé wines in 2-packs of 250-ml. cans ($11); and Altered Dimension, including Black (Cabernet Sauvignon), White (Sauvignon Blanc), and Pink (Rosé) offerings all retailing at $15.—Daniel Marsteller

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