Beam Suntory boosts Q1 profits despite flat sales

Beam Suntory Inc, the wine, beer and spirits arm of Japanese conglomerate, Suntory Holdings Limited said that its first quarter revenue for 2017 fell flat, recording 0.15% decrease in sales to ¥217bn ($1.93bn).

However, the maker of Courvoisier cognac and Basil Hayden’s bourbon among others noted that its spirits segment posted sales growth in the low single-digits, helped by strong growth in brands such as Jim Beam bourbon, Maker’s Mark whiskey and other Super-Premium bourbon brands.

It adds that the United States provided mid-single-digits boost to its sales in the Americas region.

Elsewhere, results were helped by strong boost in Europe, Middle East, Africa region (EMEA) and double-digit sales gains in South East Asia. Sales were stable in the company’s Japan business (Suntory Spirits Limited), with Jim Beam driving marketing activities behind the Beam Highball.

According to the company, the beer business experienced 2% sales decline. It notes that its Premium Malt’s product and packaging was relaunched for the first time in five years and great effort was made to create drinking experiences both in Japan and through On-premise channels utilizing the “Premium Friday” campaign and other opportunities. It said that the effort paid off with 7% sales lift for the malt’s product.

Like beer, the wine category also suffered declines in sales of 2%, reflecting adverse currency exchange conditions, the company said.

Net income for the combined wine, beer and spirits segment rose 6.35% to ¥16.2bn ($144m), from ¥15.2bn ($135m) in the previous year.

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