Campari Sales Surge On Gains By Skyy and AperolMay 12, 2011
Backed by double-digit organic growth, positive currency exchange effects and the recent addition of a trio of liqueur brands from William Grant & Sons, Italy’s Gruppo Campari achieved solid sales and profit growth in the first quarter of 2011. For the three-month period ended March 31, Campari’s net sales jumped by 14.9% to €268.4 million ($381.1m), as net profit rose by 16.6% to €50.5 million ($71.7m).
Campari’s strong performance came despite a 3% sales decline in its home market of Italy, where this year’s relatively late Easter holiday led to soft first-quarter sales for brands like Campari Soda and Glen Grant, as well as the company’s sparkling wine range. For the quarter, the Italian market accounted for only 37.7% of Campari’s global sales—a significant decline from the year-earlier period, when Italy comprised nearly 45% of company sales. That’s also a key indicator of how Campari is evolving as a global player, as not long ago the home market accounted for most of its business.
Beyond Italy, Campari thrived in Europe during the first quarter, as sales across the rest of the continent surged by 39.7%. While the vast majority of this advance came from organic growth as both the Campari and Aperol brands showed strong progress (particularly in Germany), the addition of the William Grant liqueur brands and several agency brands in the Russian market was also beneficial. Campari acquired the Frangelico, Carolans and Irish Mist liqueur brands from William Grant in September 2010, shortly after Grant purchased them from C&C. The rest of Europe accounted for roughly 23% of Campari’s first quarter sales, up from less than 19% a year before.
Campari also enjoyed significant first-quarter growth in the Americas, even as sales sagged in Brazil—the world’s biggest market for the Campari brand. Organic growth in the U.S. improved by 9.5%, due to the continued expansion of Skyy and the rapid rise of Wild Turkey American Honey, which jumped by 38% to 179,000 cases in 2010 and has been similarly explosive in 2011. Campari’s Tequila business thrived in the first quarter. Cabo Wabo held steady despite its ultra-premium positioning, while Espolón made headway after embarking on a promising U.S. relaunch in mid-2010. The Americas accounted for around 31% of Campari’s global sales in the first quarter of 2011, slightly above their share in the year-earlier period.Subscribe to Shanken News Daily’s Email Newsletter, delivered to your inbox each morning.