Nielsen Spirits Data: Solid Growth Trends

March 19, 2012
Morgan Stanley
Key takeaways from the spirits scanner data for the 4-week period ended 3/3: (1) Spirits growth continues at +4.7% (2-year avg. of +4.7%), with the momentum accelerating vs. the prior 12-week trend of +3.9% (2-yr. average of +3.7%). (2) Price/mix of +1.5% was in-line with its prior 12-week trend. (3) Strength in recent innovation (flavor extensions) continues.

Key Industry Trends: Total spirits sales for the 4-week period ended 3/3 were up +4.7% y-o-y (+4.7% on a 2-yr avg. basis), driven by +3.2% volume and +1.5% price/mix. Sales growth this month was ahead of the 3.9% growth in the prior 12-week period. Category strength in Prepared Cocktails (+25.1%), driven by Skinnygirl, Bourbon (+14.8%) and Vodka (+6.7%), were partially offset by weakness in domestic whiskey (-5.9%), Brandy (-5.3%), and gin (-2.2%). Top brand performance included Jameson (+22.0%), Makers Mark (+11.8%) and Svedka (+13.3%).

Beam: Beam sales were up +4.0% this month (2-yr. avg. of +7.6%), losing 7 bps of dollar share. This compares to the prior 12-week trend of +3.2% (2-yr. avg. of +9.3%). Strength in Maker's Mark (+11.8%) was offset by weakness in Kessler (-7.1%), Sauza (-5.8%), and Dekuyper (-3.3%).

Brown-Forman: BFB sales increased 10.8% y-o-y, aided by an easy comp with a two-year average of +5.2%. Results were an acceleration vs. the prior 12-week period of +8.3% (2-yr. avg. of +3.7%) as recent increased investment and innovation continue to drive dollar share gains (+37 bps). Jack Daniels ex. Tennessee Honey was up +3.7%, offsetting weakness in El Jimador (-1.8%) and Southern Comfort (flat result), with nearly all of the y-o-y sales growth driven by Tennessee Honey.

Constellation Brands: STZ sales were up +4.8% (2-yr avg. of +8.0%), above +3.7% growth in the prior 12-weeks (2-yr. avg. of +6.4%). STZ's dollar share was flat, and the sales growth was driven by continued strength in Svedka (+13.3%), offset by weakness in Black Velvet (-2.9%) and Paul Masson (-4.9%).