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Napa’s St. Supéry Sees Luxury Wines Coming Back In The On-Premise

February 28, 2012

High-end wine sales in the on-premise absorbed the hardest blows of the recession, and well into last year the white-tablecloth segment remained resistant to recovery. But premium producers are now seeing improvements in the upscale restaurant business. One of them is Robert Skalli’s St. Supéry Estate Vineyards in Napa Valley, whose portfolio sales are split about 50-50 between the on- and off-premise.

“Last fall we saw the on-premise begin to take a position again on some of our more expensive wines, and now the luxury end is really driving our on-premise growth,” says St. Supéry CEO Emma Swain. “It’s great to see that market recovering from the shock it took.”

Skalli sold its southern France wine holdings to Boisset, La Famille des Grands Vins last November. Those included the Fortant de France and Couleurs du Sud labels, with a total portfolio of around 1.5 million cases. But Skalli retained ownership of St. Supéry. “There was never a question of selling it,” Skalli says. “St. Supéry is my family legacy—a château investment rather than a negoçiant investment as Skalli France was—and I believe it’s just now beginning to realize its full potential.” The goal for the winery, Skalli adds, is to be recognized as “the premier estate producer of Sauvignon Blanc and one of the top Cabernet Sauvignons in Napa Valley.”

St. Supéry’s top tier includes its estate Bordeaux blend Élu ($65 a bottle at retail), as well as single vineyard wines like Dollarhide Cabernet Sauvignon ($85), red blend Dollarhide Elevation ($65) and Rutherford Merlot ($50). Aside from its Napa Valley Moscato, which has been difficult to keep in stock, those wines are currently the hottest in the company’s range. The portfolio also includes Napa Valley estate varietals Sauvignon Blanc ($20), Cabernet Sauvignon ($30) and Oak Free Chardonnay ($20).

“We have a nice national accounts business on Élu—with Ruth’s Chris and Morton’s—which has helped us keep expanding,” Swain says. At the estate level, St. Supéry’s Napa Sauvignon Blanc is an important part of the on-premise mix, selling in restaurants for between $12 and $15 by the glass. The company claims to account for around 10% of Sauvignon Blanc production (as well as around half of Moscato production) across the Napa Valley.

Company-wide, St. Supéry produces around 120,000 cases annually. Sales were roughly flat last year, but Swain says that was due to a shortfall of Moscato (owing to heavy spring rains which lightened its Moscato crop by half, to around 3,500 cases), as well as the elimination of its Dollarhide Merlot label. The group’s core Napa estate varietals were each up by double-digits last year, and across the portfolio, growth is tracking up 16% year-on-year so far in 2012. California, Texas, Florida, New York and the Pacific Northwest have all been performing strongly for the company.

This year, along with new packaging playing up its Napa provenance that’s debuting across the line, St. Supéry will be increasing production of its Napa Valley Rosé ($16). Made predominantly of Merlot and Cabernet, the rosé will be extended into national distribution for the first time, and likely sell beyond its typical end-of-spring horizon. “We’ve been making rosé on and off for many years,” Swain says. “We usually send out samples prior to bottling to gauge interest, and this year we’ve had a much greater response than in years past, so we’ll be selling it across the country. It’s a small but growing category.”

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