- Reported sales in three months to end of September decline 4.8% to CLP213bn [US$241.9m]
- Year-to-date sales – again on reported basis – also down, by 7.4% at CLP577.83bn
- Q3 exports – not including the US – fall 5.9%, US sales -5.5%
Viña Concha y Toro has seen its forecast of “a significant acceleration in sales” in the second half of 2023 fail to materialise as the top line fell again in Q3.
Three months on from posting a top-line decline of almost 9% from the first six months of this year, the wine group saw sales in the three months to the end of September come in down by just under 5% on the corresponding period a year ago. Subsequently, nine-month sales finished at -7.4%.
In August’s six-month results announcement, CEO Eduardo Guilisasti had said he anticipated “a growth in sales in the second half of the year”.
"The lower [Q3] sales volumes [-3.8% on Q3 2022] are driven, to a large extent, by two factors," Concha said. "In a more restrictive financial environment, with the highest interest rates in 15 years, distributors chose to reduce inventories throughout the supply and sales chain.
"The second factor is related to adjustments in consumption as a result of lower economic growth in the main economies in a context of inflationary pressures."
The group also noted its performance would have been worse had it not been for its "extensive proprietary global distribution network". Despite this, Guilisasti flagged "improvements" from the quarter compared to the previous two. "Conditions have tended to improve recently," he said, "[although] the factors that affected the business during the first half of the year persisted in the third quarter."
In the US, where figures for wine exports are grouped with those for California-based Bonterra Organic Estates, Concha said its volumes were flat while sales by value decreased by 5.5%. The pre-referenced inventories issue took the bulk of the blame, as foreign exchange fluctuations also played their part. More broadly, according to the company, the wine category in the country is seeing "lower sales volumes especially among <$10 segments".
Elsewhere, exports to Europe were up in value terms by mid-single digits, although Asia slumped by almost 30%, albeit predominantly due to the conclusion of a private brand arrangement in China.
Brands-wise, Bonterra and Casillero del Diablo earned namechecks for their US performances, with Argentinean brand Trivento climbing by almost 13% in value.
The company also highlighted the launch in Q3 of Casillero extension Devil's Carnaval, targeted at younger LDA consumers.
[NB: Concha y Toro reports its results in reported terms and not on an organic basis]
Viña Concha y Toro's official Q3 & YTD results announcement.
