Davide Campari-Milano SpA, the maker of Wild Turkey bourbon, said first-half profit climbed 8.7 percent and that it bought the Sagatiba brand to expand in the Brazilian spirits market.
Net income in the six months ending June 30 rose to 75.3 million euros ($107 million) from 69.3 million euros a year earlier, the Milan-based company said in a statement today. That compared with the 76.7 million-euro average estimate of eight analysts in a Bloomberg survey. Revenue climbed 14 percent to 589.1 million euros in the period as sales rose in Germany.
Chief Executive Officer Bob Kunze-Concewitz said in May that the company expects as much as 30 percent of sales to come from emerging markets within five years, and it plans to expand in Latin America, eastern Europe, the Pacific region and Africa. The company is looking to buy brands and has more than 500 million euros to spend, he said at the time. Campari is “optimistic” about its prospects for the full year, the CEO said in the statement today.
Campari paid $26 million for Sagatiba, which it started selling in Latin America under a distribution agreement in March 2010. “Sagatiba, the leading super premium and fast growing cachaca brand in Brazil, significantly strengthens our brand portfolio in that key emerging market,” said Kunze-Concewitz.
Sagatiba gets about two-thirds of its sales from Brazil and will appeal to drinkers looking to buy more expensive spirits in the country, Kunze-Concewitz said today on a conference call.
“We’re seeing consumers overall premiumising and moving up in terms of their drinking habits” in Brazil, “a very important market for us,” he said.
So-called organic sales grew 12 percent. The increase was primarily driven by increased volume, as consumers bought more Aperol and Skyy vodka, Kunze-Concewitz said.
Campari’s shares were down 0.4 percent as of 3:38 p.m. in Milan trading, giving the company a market value of 3.2 billion euros.