Cuervo Up 22% In The First Half, Despite Supply Chain ChallengesJuly 29, 2022
Grupo Cuervo achieved 22% net sales growth to just over $1 billion in its fiscal first half ended in June, even as supply chain struggles and tough comps hit U.S. volumes in the second quarter. The company’s operating income grew by 32% to $206 million in the first six months of the year.
Overall, Cuervo’s second quarter sales came in up 19% to $567 million on a volume increase of 11.4% to 7.1 million cases, with operating income jumping 49% to $107 million. The strong numbers came despite logistical challenges and difficult year-over-year comparisons in the U.S. and Canada, which accounted for 60% of group sales during the second quarter but eked out only a 0.2% increase, coinciding with a volume decline of 7.6% to 4.1 million cases. Cuervo said the volume decrease was “mainly due to an impact from supply chain disruptions and a high comparison base in ‘Non-alcoholic and Other’ and ‘RTD’ for the same period last year.” The group’s RTD volume was down 12% to 1.3 million cases globally in the second quarter.
Still, Cuervo noted that the flat North American sales performance in the face of lower volumes showed the positive impact of its “premiumization strategy and price increases throughout the portfolio.” Subsidiary Proximo Spirits saw higher-priced Tequilas 1800 and Jose Cuervo Tradicional earn Impact “Hot Brand” awards for their 2021 performances, joined by Pendleton and Proper No. Twelve whiskies.
“Even though the global environment remains volatile, with a difficult macro and inflationary backdrop, we continue to anticipate favorable trends across our portfolio and geographical regions as a result of the on-premise rebounds, off-premise resilience and our ongoing premiumization efforts,” the company stated.—Daniel Marsteller
|Proximo Spirits—Key Brands In The U.S.|
in Control States2
|The Kraken||Imported Rum||381||-6.4%|
|Proper No. Twelve||Irish Whiskey||280||-5.5%|
|Playamar Seltzer||Premixed Cocktail||101||63.9%|
|Total Key Brands||12,551||-0.1%|
|1 Thousands of 9-liter case depletions
2 Year-to-date through June
Source: NABCA and IMPACT DATABANK © 2022
Tagged : 1800 Tequila, Bushmills, Jose Cuervo, Pendleton, Proper No. Twelve, Proximo Spirits
GET YOUR FIRST LOOK AT 2021 DATA AND 2022 PROJECTIONS FOR THE WINE AND SPIRITS INDUSTRIES. ORDER YOUR 2022 IMPACT DATABANK REPORTS. CLICK HERE.