North America was up 2% in volume and 4% in net sales, while Diageo’s net sales in Spain and Portugal were flat, due mainly to the decline of J&B scotch. Baileys grew, along with Johnnie Walker and Gordon’s.
Baileys doesn’t even get a mention in the review of Africa and Asia Pacific, and only gets an honourable mention for Australia where it “performed strongly and gained share”. For Latin America and the Caribbean, net sales were up 5%, but volume down 1%.
Diageo reports: “Performance in both Mexico and Colombia was strong with net sales up 20% and 24% respectively, driven by scotch and the introduction of Baileys flavours.”
As to Colombia: “Innovation through flavours, plus strong focus behind brilliant execution during peak selling seasons contributed to a 7% increase in Baileys net sales and increased share in a growing category,” the results report states.
Mark Sandys, global head of Baileys, tells Drinks International: “In the five years since the financial crisis, sales have been relatively flat, but Baileys is showing strong growth and Europe is leading the way.”
Diageo’s success in liqueurs is in marked contrast to Pernod Ricard’s. In its half-year 2015/16, it shows Malibu and Kahlúa, two of its top 14 brands, showing 0% growth and sales down 5%.
At the subsequent briefing, Drinks International’s Hamish Smith asked Pernod CEO Alexandre Ricard what the company is doing to turn these liqueurs brands around.
Ricard replied: “You have shipments and you have underlying trends. In the US market Malibu is performing pretty well.
“The latest Nielsen Panels say it’s up 3% in value growth in the US – which, for a brand the size of Malibu, is a strong performance – and is outperforming its category.”
FLAVOUR ADDITIONS
Denis O’Flynn, CEO of Pernod Ricard UK, added: “Malibu is growing at 5% in the on and off-trade and is now at 400,000 cases [in the UK]. The RTD as a mechanic has worked very well. We’ll be launching a few more flavours – Kiwi and Strawberry are the latest – and Malibu Pineapple is coming in for National Piña Colada Day on July 10. In the context of the UK it’s one of our key drivers of growth.”
And Kahlúa? Ricard said: “Kahlúa is down 5%. It’s fair to say from a prioritisation and resources point of view Kahlúa is not a brand behind which we are investing most. It happens.”
Smith asked: “It’s still a top 14 priority brand though?” Ricard said: “Yeah, but… (tails off, shrugs and smiles).” So a non-priority top 14 priority brand, looks like.
Rémy Cointreau’s results for the nine months ended December 31, showed double-digit sell-in and sell-out growth in Germany, led by Rémy Martin cognac and Cointreau.
It reports that Cointreau was hit by competition in the US in the first half, an early Easter in western Europe (first quarter) and changes in distributors in Australia and Canada.
In the meantime, Cointreau has launched “the ultimate party must-have, a cocktail maker that will transform you and your friends into mixologists within minutes”.
