Value gains drive Viña Concha y Toro Q2 revenue increase – results data

Second quarter revenues up 3.2% to CLP244.83bn (US$253.39bn) on a reported basis
Sales for first six months of year rise 2.3% to CLP453.81bn
Q2 volumes up by only 1.1%, but average prices rise by 2.1%
Solid gains in Europe and Chile, but declines in US and Asia

Viña Concha y Toro overcame difficult trading conditions in a number of markets to post a 3.2% rise in second-quarter revenues, driven by value gains as volumes remained relatively static.

The performance was an improvement on the company’s difficult first three months of the year, when sales were up by only 1.4%. Concha’s coverage of its results details sales in reported terms, which includes the impact of currency fluctuations.

Volumes in the three-month period to the end of June were up by 1.1%, but revenues were boosted by a 2.1% gain in average prices, with premium and higher-end brands accounting for 54.3% of sales during the quarter.

The company picked out the Q2 revenue performances of Don Melchor (+208.3%), Casillero del Diablo (+1.2%), Diablo (+14.2%) and Argentina’s Trivento (+7.2%).

Market performances were mixed. Export sales (which exclude the US) rose by 6.8% during the second quarter, with Europe up 8.1% thanks to growth in the UK and double-digit gains in Sweden and Denmark.

Revenues in Latin America jumped 7%, boosted by a double-digit gain in Brazil, but Asia was down 8.2%, driven by a 13.8% decline in Japan, which Concha blamed on “inventory adjustments”.

Volumes in the US market fell by 15.1% in the quarter, thanks to declines in non-premium segments caused by tariffs, leaving US revenues down 8.8%.

Concha’s home market of Chile was more positive: Q2 revenues rose by 7.2%, with wine up 4.5% and beer/spirits rising 16.2%. Volumes declined by 1.4%, but a stronger premium mix drove average prices up by 6.1%.

“The second quarter of the year was characterised by high economic uncertainty and global volatility, in a context that remains complex for the global alcohol industry,” said Viña Concha y Toro CEO Eduardo Guilisasti.

He highlighted the fact that the company had grown reported revenues for the seventh consecutive quarter, but admitted that margins had been pressurised by “tariff measures, higher taxes in certain markets and aggressive competition in lower-value products”.