Campari announces continued strong results in Q3 2010, confirming double digit growth across all performance indicators for the first nine months 2010

HIGHLIGHTS –  FIRST NINE MONTHS 2010

  • Sales: € 794.9 million (+14.1%, organic growth +6.8%)
  • Contribution after A&P: € 324.6 million (+16.5%, organic growth +8.9%, 40.8% of sales)
  • EBITDA before one-offs: € 205.3 million (+15.5%, organic growth +10.7%, 25.8% of sales)
  • EBIT before one-offs: € 186.4 million (+16.9%, organic growth +12.3%, 23.4% of sales)
  • Group pre-tax profit: € 156.3 million (+16.9%)
  • Net financial debt: down to € 590.5 million thanks to healthy cash generation and positive forex effects

Milan, November 11, 2010 - The Board of Directors of Davide Campari-Milano S.p.A. approved the results for the first nine months ending 30 September 2010.

In the first nine months of 2010 Gruppo Campari achieved very strong results, delivering double digit growth across all performance indicators. The third quarter saw, for the third consecutive period, a positive organic growth in net sales (+3.7%) thanks to good consumption momentum across key brand and market combinations, particularly spirits.

Bob Kunze-Concewitz, Chief Executive Officer: ‘Our performance in the first nine months of 2010 was very positive with significant growth across all key indicators. Looking forward to the remainder of the year, we confirm our balanced view of risks and opportunities. We are optimistic about our full year and medium term prospects’.

In the first nine months of 2010, Group sales totalled € 794.9 million (+14.1%, +6.8% organic growth, +3.3% exchange rate effect and +4.0% perimeter effect, the latter mainly due to the Wild Turkey acquisition).

Gross margin increased to € 460.4 million, up 15.9%, or 57.9% of sales, mainly thanks to a favourable sales mix driven by spirits’ double-digit growth.
Contribution after A&P (gross margin after A&P) was up by 16.5% to € 324.6 million (+8.9% organic growth), or 40.8% of sales.
EBITDA before one-offs was up by 15.5% to € 205.3 million (+10.7% organic growth), or 25.8% of sales.
EBITDA reached € 202.2 million, an increase of 15.0%.
EBIT before one-offs rose by 16.9% to € 186.4 million (+12.3% organic growth), or 23.4% of sales.
EBIT reached € 183.3 million, an increase of 16.4%.

Pre-tax profit reached € 156.3 million (+16.9%; +12.9% at constant exchange rates).
As of 30 September 2010, net financial debt stood at € 590.5 million (€ 630.8 million as of 31 December 2009), due to healthy cash flow generation and positive forex. As already announced, on October 1, 2010 the acquisition of Carolans, Frangelico and Irish Mist brands from William Grant&Sons was completed for a total consideration of € 129 million.

CONSOLIDATES SALES FOR THE FIRST NINE MONTHS OF 2010

Sales of spirits (76.5% of total sales, up from 73.2% in the first nine months 2009) grew +19.2%, the combined result of organic growth of +10.1%, a positive exchange rate effect of +4.1% and a positive perimeter effect of +5.0%.

Campari brand sales increased by +8.6% at constant exchange rates (+12.1% at actual exchange rates), thanks to the positive performances in key European markets and a strong recovery in Brazil. SKYY sales grew by +3.9% at constant exchange rates (+8.0% at actual exchange rates), driven by a positive performance of the SKYY franchise in the US and continued growth in key international markets. Aperol confirmed its very strong momentum (+36.6% at constant exchange rates) in Italy and in international markets (particularly Germany and Austria). Camparisoda registered a slight increase in the first nine months of 2010 (+0.7%). The Brazilian brands posted a significant sales growth (+31.2%), thanks to the successful execution of the new commercial policy and a favourable comparison base versus the corresponding period last year. GlenGrant achieved a positive performance (+5.6% at constant exchange rates), while Cynar registered a slight decrease.

Wines, which accounted for 12.3% of total sales, increased +2.1%, due to the combination of a organic performance of -0.8%, a perimeter effect of +1.2% and an exchange rate effect of +1.7%. Cinzano brand registered positive results: Cinzano sparkling wines sales increased by 7.8% (+8.4% at a constant exchange rates), thanks to a positive performance in Russia; Cinzano vermouths sales grew by 6.5% (+8.6% at a constant exchange rates), mainly thanks to a recovery in the key Russian market. Sella&Mosca sales decreased by 1.7%, while Riccadonna suffered a temporary slow-down due to its transition to the newly established distribution platform in the key Australian market.

Soft drinks (9.8% of total sales) recorded a negative variation of -3.0% whereas the third quarter positive results (+1.9%) partly offset the decline registered in the first half. In the first nine months the performance of both mineral waters and carbonated soft drinks (-3.9%) were negatively affected by unfavourable weather. The return to positive results of Crodino in the third quarter (+1.8%) improved soft performance registered in first half (-2.6% in the nine months 2010).

Looking at sales by region in the first nine months 2010, sales in the Italian market (35.1% of total Group sales, down from 39.3% in the first nine months 2009) recorded an increase of +2.1%, thanks to organic growth (+2.7%), partly offset by a negative perimeter effect of -0.6%.

Sales in the rest of Europe (22.8% of consolidated sales) increased by +15.1%, thanks to positive trading both in Western and Eastern European markets. These results were driven by positive organic growth of +13.7%, a positive perimeter effect of +0.6% and a positive exchange rate effect of +0.8%.

The Americas (35.3% of total sales) posted overall growth of +30.3%, driven by an organic increase of +13.1%, a positive exchange rate effect (+8.4%) and a positive perimeter effect (+8.8%), the latter due to the Wild Turkey acquisition. In the Americas, the US market registered an organic increase of +6.0%, a positive exchange rate effect of 3.8% and positive perimeter effect of +11.2%. In Brazil, organic sales grew by 31.4%, thanks to a return to regular trading. Performance in Brazil was also positively affected by a perimeter effect of +2.0% and a significant exchange rate effect (+27.5%).

Sales in the rest of the world (including duty free), which accounted for 6.7% of total sales, grew by +7.3% overall, due to a positive perimeter effect of +19.2%, a positive exchange rate effect of +7.2% and a negative organic change of 19.1% mainly due to its transition to the newly established distribution platform in the key Australian market.

OTHER RESOLUTIONS

Procedures for transactions with related parties. The Davide Campari-Milano S.p.A Board of Directors has adopted the ‘Procedures for transactions with related parties’ pursuant to Consob resolution n. 17221 of 12 March 2010. These procedures shall be effective as of 1 January 2011.

The Manager in charge of preparing Davide Campari-Milano S.p.A.’s financial reports, Paolo Marchesini, certifies - pursuant to article 154 bis, paragraph 2 of the Legislative Decree 58/1998 (Consolidated Law on Financial intermediation) - that the accounting disclosures in this statement correspond to the accounting documents, ledgers and entries.


MEDIA CONFERENCE CALL


At 12.15 pm (CET) today, Thursday, November 11, 2010, Bob Kunze-Concewitz, Gruppo Campari’s CEO, will hold a conference call in English to present the Group’s 2010 nine months results to the media. To participate, please dial one of the following numbers:

  • from Italy: 02 8058 811
  • from abroad: +44 203 147 47 96

ANALYST CONFERENCE CALL

At 1.00 pm (CET) today, Thursday, November 11, 2010, Campari’s management will hold a conference call to present the Group’s 2010 nine months results to analysts and investors. To participate, please dial one of the following numbers:

  • from Italy: 02 8058 811
  • from abroad: +44 203 147 47 96

The presentation slides can be downloaded before the conference call from the main investor relations page on Gruppo Campari’s website.
A recording of the conference call will be available from Friday, November 12 until Thursday, November 18, 2010.
To listen to it, please call the following number:

  • from Italy: 02 72495
  • from abroad: +44 207 0980 726
    (access code: 741#)
Publishing date: 
11 Nov 2010
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Last updated May 27 2013