Sales of premium spirits boost Beam Suntory results
Global spirit producer Beam Suntory saw strong global sales across 2021, up 11%, driven by sustained growth in the off-trade and a good performance in markets where the on-trade has reopened faster than expected.
Encouragingly, the results also strong strong growth compared to the pre-pandemic levels of 2019, with overall sales of 11% over the last two years, it said.
There was double digit growth in Germany, Russia, Spain, and emerging Asian markets, including China and India, which are key to the company’s future plans, as well as in Global Travel Retail. There was also “robust demand” for premium brands in the US, which saw high-single digit growth, although Japan was impacted by extended on-premise restrictions, limiting its growth to the mid single digits although there was strong demand for convenient ready-to-drink beverages, it said.
Albert Baladi, president & CEO of Beam Suntory said the results underscore the strength of the company’s premiumization strategy which “relies on exceptional quality, superior storytelling, and executional excellence across consumer touchpoints”, he said.
Brands in strong double digits growth included Maker’s Mark, Basil Hayden, Knob Creek, Booker’s and Legen bourbons, Scotch whiskies Laphroaig, Bowmore and Auchentoshan, and Japanese whiskies Hibiki, Hakushu and Toki, as well as English gin and vodka brand Sipsmith and Suntory’s Roku gins, and El Tesoro and Hornitos tequilas. Its On the Rocks brand, which was acquired in 2020 also saw “exceptional growth”, while there was solid growth of its flagship Jim Beam bourbon, “despite glass supply constraints affecting certain bottle sizes”.
“Our confidence in the future is reinforced by the strategic moves we’re making, with accelerated investment in our business — including capacity, capabilities and our sustainability agenda,” Baladi added, pointing to the 2021 acquisition of its route to market in Spain, and the upcoming joint innovations with Boston Beer.
“We’re immensely proud of the results our business has been able to deliver in the face of historical challenges related to the pandemic, including on-premise closures and supply chain constraints,” he concluded.
The company also provided an update on its sustainability strategy, Proof Positive, which was launched in 2021. This has seen it move towards 100% renewable electricity usage at its operations by the end of 2022, and install closed loop cooling systems in two of its Kentucky distilleries. This year, it will launch a pilot to generate “green” hydrogen at its Ardmore distillery in Aberdeenshire. It is also setting to boost the diversity of the company, increasing new female hires from 6% to 50% in 2021, and seeing the number of multi-cultural employee in the mid and senior manager levels rise by 4%, as well as boosting the opportunities for internal promotions for its existing multicultural workforce.