Supply Chain Issues Slow Cuervo’s U.S. Sales In The Third Quarter
October 29, 2021Grupo Cuervo posted sales down 7.9% to approximately $470 million in its fiscal third quarter ended in September, reflecting supply chain challenges and tough year-over-year comps in the U.S. and Canada.Volume dipped 2% to 6.5 million 9-liter cases, while EBITDA fell 35% to $103 million. For the first nine months of the year, sales remain up by 8% to $1.29 billion, although operating income is down 12.6% to $246 million.
Company volume in the U.S. and Canada was down 18.6% for the quarter to 3.5 million cases, but remains 23% above its Q3 2019 level. Similarly, North America sales were down 24.6% to about $277 million, but are up 35% versus 2019. Cuervo cited “supply chain related issues, the difficult comparison base with Covid-19 pandemic-driven results in the third quarter of 2020, and the appreciation of the Mexican peso” as holding down its U.S. sales in the period. While North America saw challenges, Cuervo’s other global regions were up double-digits.
The third-quarter declines were centered in Cuervo’s flagship Tequila brand and RTDs, whose global volume decreased 8.7% and 29% for the quarter, while other Tequilas, spirits, and non-alcoholic brands saw solid ongoing growth. A 41% increase in distribution expenses—blamed on heightened freight, warehousing and logistics costs—also weighed on the company in the third quarter.—Daniel Marsteller
| Proximo Spirits—Key Spirits Brands | |||||
| Brand | Origin/Type | Total 2020 Depletions1 |
2021 YTD Percent Change In Control States2 |
||
|---|---|---|---|---|---|
| Jose Cuervo | Tequila | 4,703 | 4.1% | ||
| Jose Cuervo Margaritas3 | Pre-mixed Cocktail | 3,338 | 2.1% | ||
| 1800 | Tequila | 1,531 | 18.9% | ||
| Three Olives | Vodka | 875 | -6.4% | ||
| 1800 Ultimate Margaritas | Pre-mixed Cocktail | 627 | 17.5% | ||
| The Kraken | Rum | 491 | * | ||
| Pendleton | Canadian Whisky | 397 | 12.5% | ||
| Proper No. Twelve | Irish Whiskey | 232 | 33.0% | ||
| Bushmills | Irish Whiskey | 201 | 1.3% | ||
| Gran Centenario | Tequila | 141 | 44.4% | ||
| Tin Cup | American Whiskey | 90 | 6.8% | ||
| Total Key Brands4 | 12,625 | 7.2% | |||
| Other Brands | 625 | 9.6% | |||
| Total Proximo Spirits | 13,250 | 7.3% | |||
| * Less than 0.05% 1 Thousands of 9-liter cases. 2 Year-to-date through September. 3 Includes Authentic and Golden. 4 Addition of columns may not agree due to rounding. Source: NABCA and IMPACT DATABANK © 2021 |
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Tagged : Grupo Cuervo
