Pernod Mixed in the U.S.
As usual, the 15 strategic brands were the main drivers of growth for Pernod Ricard across the board. They grew 7% in volume and 13% in value overall, thereby demonstrating the very positive impact of price increases and mix effects, said Pernod. In particular, premium spirits grew 17%.
All geographic regions contributed to consolidated sales growth, with an accelerated contribution from emerging countries, up 25%. China, India and Russia were, in that order, the leading three contributors to the sales growth, as premium brands continue to grow. Europe (+15%) and France (+12%) also exemplified “dynamic growth in the first half.” Meanwhile, the Americas region fell short with 10% organic growth, hurt by the foreign exchange rate and group structure.
Management raised full year guidance again since it announced first half sales on January 24 from “about 12%” organic growth to “at least 12%.”
ABSOLUT. When asked about Absolut and Stoli, Pierre kept mum. “We shall not speak about vodka. No comment.” Things are likely heating up in the Absolut deal and Pernod probably doesn’t want to mess anything up.
“While we expect strong organic EBIT growth to be delivered, the key driver of the share price is likely to be whether the company acquires Stolichnaya or V&S. We believe that Fortune Brands remains the front runner for acquiring V&S, and take the view that fears of Pernod
diluting returns and earnings are overdone,” said UBS analyst, Melissa Earlam.
U.S. BRAND STRENGTH. The brands that did well in the U.S. were Jameson, The Glenlivet, Malibu, Stoli, Jacob’s Creek and Perrier Jouet. As usual, Chivas, Beefeater and Kahlua were not so hot.
First half depletions of Chivas declined -7%. Pierre said that while the U.S. showed negative performance, “we have to keep in the mind the U.S. market is not the best performer.”
Pierre remarked that Kahlua is “our only tough spot in the portfolio,” as the situation remains difficult in the U.S. Depletions declined -6%, with Nielsen numbers down -2%. However, the company hopes that Kahlua’s new marketing campaign, "Dare to be curious," will help the brand in the future.
“We knew it [Kahlua] would be difficult. It has become somewhat time-worn in its positioning... Before it was desperate housewives that used Kahlua as a sort of comfort in their boring, tedious lives...we hope the brand will be repositioned with a more fashionable, youthful position,” said Pierre.
Beefeater is also having some difficulty in the U.S. market, with depletions down -5% and Nielsen numbers down -4%.
Jameson, meanwhile, “continued outstanding growth in the US with HY1 depletions up 23% (Nielsen +32%).” Pierre noted that “people say the market in the U.S. is difficult, but for some brands that is not true,” as seen with the strong growth for Jameson.
Depletions of Glenlivet grew 5%, with Nielsen up 1% and NABCA up 4%. Malibu shipments grew 4%, with Nielsen up 13% and NABCA up 9%.
Stoli continued its volume growth, in spite of price increases, with first half shipments up 1% and volume up 4%, according to Nielsen.
Jacob’s Creek wine saw stable depletions in the U.S. with improved mix, while Montana had “very strong growth” with depletions up 19%. Perrier Jouet also saw “good growth” in the U.S.
Here’s what Pierre had to say on the overall U.S. market:
“It’s fair to say that what used to perform is still performing and what hasn’t performed too well in the past is not performing any better now. Jameson is still performing very well. Glenlivet is still performing very well. Our wines, Champagnes, Malibu, and Seagram’s Gin are performing well. Seagram’s is a middle of the range product and it’s doing well. But we’ve had problems with Chivas in the recent past. Our positioning is not that good in the U.S. although it’s good elsewhere. You see that Chivas’ growth is quite remarkable...we have problems with Kahlua and we told you about the repositioning that we’ve initiated. We hope the new position “Dare to be Curious” will be more appealing to consumers. We’ve had some problems with Beefeater but there too the campaign is being launched in the U.S. market....with Chivas we haven’t settled the problem yet. With Beefeater and Kahlua we hope the new positioning will be successful. So we’re not bearish about the U.S. So how long will this last? Everyone tells you that’s there’s a crisis looming, so it’s hard to tell....some people think the crisis won’t land too long and I tend to share that view.”
BARTON BRANDS NOW CALLED CONSTELLATION SPIRITS
Barton Brands, Constellation’s spirits division, announced it is realigning its sales and marketing organizations into two groups that will concentrate on premium and value brands. In addition, the company name will be now known as Constellation Spirits, with the newly formed premium brands group named Ascender Brands and the value brands team retaining the Barton Brands moniker. These changes will be effective March 1, 2008. There are no changes planned for Spirits Marque One, producer, importer and marketer of SVEDKA Vodka, which will remain a separate operating group within Constellation Spirits.
Philip Kingston, currently the company's senior vice president of business development, will become senior vice president of national sales for Barton Brands, while Mike Novy moves over from Constellation's Centerra Wine Company to become senior vice president of national sales for Ascender Brands.
Additionally, Rick Renkens will be assuming the role of executive vice president - sales for control states, national accounts and export. Renkens will also manage Canadian sales and marketing efforts. In U.S. control states, his team will sell both the value and premium portfolios. This group will also continue to be responsible for managing Svedka’s business in national accounts, exports and Canada.
WSD BRIEFS:
RED BULL NORTH AMERICA reached a negotiated settlement with Roxy, an Orlando, Fla.-based nightclub, that resolves "passing off" claims alleged in a lawsuit filed by Red Bull. The lawsuit, filed in federal court in Florida, alleged that customers who visited Roxy and requested a Red Bull routinely received a substitute beverage without being notified of the substitution. The terms of the settlement include a permanent injunction against Roxy and its employees that precludes them from "passing off" other beverages as Red Bull. In addition, Roxy has agreed to pay Red Bull an undisclosed amount.
AN ARIZONA JUDGE tossed out a challenge to Arizona's alcohol law yesterday, which only allows wineries producing less that 20,000 gallons a year to ship directly to state residents.
Until tomorrow, Megan
“Whatever you may be sure of, be sure of this, that you are dreadfully like other people.”
-James Russell Lowell
--------- Sell Day Calendar ----------
Today’s Sell Day: 20
Sell days this month: 21
Sell days this month last year: 20
This month ends on a: Fri.
This month last year ended on a: Wed.
YTD sell days Over/Under: 0
All geographic regions contributed to consolidated sales growth, with an accelerated contribution from emerging countries, up 25%. China, India and Russia were, in that order, the leading three contributors to the sales growth, as premium brands continue to grow. Europe (+15%) and France (+12%) also exemplified “dynamic growth in the first half.” Meanwhile, the Americas region fell short with 10% organic growth, hurt by the foreign exchange rate and group structure.
Management raised full year guidance again since it announced first half sales on January 24 from “about 12%” organic growth to “at least 12%.”
ABSOLUT. When asked about Absolut and Stoli, Pierre kept mum. “We shall not speak about vodka. No comment.” Things are likely heating up in the Absolut deal and Pernod probably doesn’t want to mess anything up.
“While we expect strong organic EBIT growth to be delivered, the key driver of the share price is likely to be whether the company acquires Stolichnaya or V&S. We believe that Fortune Brands remains the front runner for acquiring V&S, and take the view that fears of Pernod
diluting returns and earnings are overdone,” said UBS analyst, Melissa Earlam.
U.S. BRAND STRENGTH. The brands that did well in the U.S. were Jameson, The Glenlivet, Malibu, Stoli, Jacob’s Creek and Perrier Jouet. As usual, Chivas, Beefeater and Kahlua were not so hot.
First half depletions of Chivas declined -7%. Pierre said that while the U.S. showed negative performance, “we have to keep in the mind the U.S. market is not the best performer.”
Pierre remarked that Kahlua is “our only tough spot in the portfolio,” as the situation remains difficult in the U.S. Depletions declined -6%, with Nielsen numbers down -2%. However, the company hopes that Kahlua’s new marketing campaign, "Dare to be curious," will help the brand in the future.
“We knew it [Kahlua] would be difficult. It has become somewhat time-worn in its positioning... Before it was desperate housewives that used Kahlua as a sort of comfort in their boring, tedious lives...we hope the brand will be repositioned with a more fashionable, youthful position,” said Pierre.
Beefeater is also having some difficulty in the U.S. market, with depletions down -5% and Nielsen numbers down -4%.
Jameson, meanwhile, “continued outstanding growth in the US with HY1 depletions up 23% (Nielsen +32%).” Pierre noted that “people say the market in the U.S. is difficult, but for some brands that is not true,” as seen with the strong growth for Jameson.
Depletions of Glenlivet grew 5%, with Nielsen up 1% and NABCA up 4%. Malibu shipments grew 4%, with Nielsen up 13% and NABCA up 9%.
Stoli continued its volume growth, in spite of price increases, with first half shipments up 1% and volume up 4%, according to Nielsen.
Jacob’s Creek wine saw stable depletions in the U.S. with improved mix, while Montana had “very strong growth” with depletions up 19%. Perrier Jouet also saw “good growth” in the U.S.
Here’s what Pierre had to say on the overall U.S. market:
“It’s fair to say that what used to perform is still performing and what hasn’t performed too well in the past is not performing any better now. Jameson is still performing very well. Glenlivet is still performing very well. Our wines, Champagnes, Malibu, and Seagram’s Gin are performing well. Seagram’s is a middle of the range product and it’s doing well. But we’ve had problems with Chivas in the recent past. Our positioning is not that good in the U.S. although it’s good elsewhere. You see that Chivas’ growth is quite remarkable...we have problems with Kahlua and we told you about the repositioning that we’ve initiated. We hope the new position “Dare to be Curious” will be more appealing to consumers. We’ve had some problems with Beefeater but there too the campaign is being launched in the U.S. market....with Chivas we haven’t settled the problem yet. With Beefeater and Kahlua we hope the new positioning will be successful. So we’re not bearish about the U.S. So how long will this last? Everyone tells you that’s there’s a crisis looming, so it’s hard to tell....some people think the crisis won’t land too long and I tend to share that view.”
BARTON BRANDS NOW CALLED CONSTELLATION SPIRITS
Barton Brands, Constellation’s spirits division, announced it is realigning its sales and marketing organizations into two groups that will concentrate on premium and value brands. In addition, the company name will be now known as Constellation Spirits, with the newly formed premium brands group named Ascender Brands and the value brands team retaining the Barton Brands moniker. These changes will be effective March 1, 2008. There are no changes planned for Spirits Marque One, producer, importer and marketer of SVEDKA Vodka, which will remain a separate operating group within Constellation Spirits.
Philip Kingston, currently the company's senior vice president of business development, will become senior vice president of national sales for Barton Brands, while Mike Novy moves over from Constellation's Centerra Wine Company to become senior vice president of national sales for Ascender Brands.
Additionally, Rick Renkens will be assuming the role of executive vice president - sales for control states, national accounts and export. Renkens will also manage Canadian sales and marketing efforts. In U.S. control states, his team will sell both the value and premium portfolios. This group will also continue to be responsible for managing Svedka’s business in national accounts, exports and Canada.
WSD BRIEFS:
RED BULL NORTH AMERICA reached a negotiated settlement with Roxy, an Orlando, Fla.-based nightclub, that resolves "passing off" claims alleged in a lawsuit filed by Red Bull. The lawsuit, filed in federal court in Florida, alleged that customers who visited Roxy and requested a Red Bull routinely received a substitute beverage without being notified of the substitution. The terms of the settlement include a permanent injunction against Roxy and its employees that precludes them from "passing off" other beverages as Red Bull. In addition, Roxy has agreed to pay Red Bull an undisclosed amount.
AN ARIZONA JUDGE tossed out a challenge to Arizona's alcohol law yesterday, which only allows wineries producing less that 20,000 gallons a year to ship directly to state residents.
Until tomorrow, Megan
“Whatever you may be sure of, be sure of this, that you are dreadfully like other people.”
-James Russell Lowell
--------- Sell Day Calendar ----------
Today’s Sell Day: 20
Sell days this month: 21
Sell days this month last year: 20
This month ends on a: Fri.
This month last year ended on a: Wed.
YTD sell days Over/Under: 0
posted at 2:08 PM
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