Chivas Brothers, the Scotch Whisky business of Pernod Ricard, released its 2022 Half Year (July – December 2021) results at the end of last week and called on the UK Government to continue to prioritise Scotch whisky in ongoing and new international trade talks.
The Half Year results confirm a recovery to beyond pre-Covid levels (+10% vs Half Year 20), with a particularly strong performance in domestic markets leading to net sales of +23% despite the evolving challenges of the global COVID-19 pandemic and supply chain disruptions.
Sales were particularly strong in Asian markets (+20%) where lockdown restrictions have been limited. As in recent years, performance in Eastern Europe continued to be strong (+22%), while premiumisation has seen Central and South American consumers trading up to international brands, leading to +44% growth.
Chivas’ transformational year was boosted by +23% global growth. This performance comes on the back of a new look and strategy, and is driven by its core range and the success of the Chivas Extra 13 collection, whose growth has more than trebled in the past six months. All Chivas Brothers’ strategic brands recorded strong double-digit value growth momentum and are growing beyond pre-Covid levels.
Ballantine’s core range’s expansion in domestic markets and premiumisation through new releases such as Ballantine’s 7, Ballantine’s American Barrel 10 Year Old and Ballantine’s Light saw global sales rise +29%. Royal Salute’s strategic shift to attract new consumers with new moments of consumption beyond the historic importance of the travel retail market has paid off, with +41% global sales growth, driven by its core Royal Salute 21 range and launches such as the Royal Salute Richard Quinn Edition and The Glenlivet maintained strong performance with +21% global growth, fuelled by the success of the Ultra Premium+ range and Limited Editions in China and the rest of Asia, while continuing to increase value share in the USA.
Chivas Brothers Chairman and CEO Jean-Etienne Gourgues said, “New releases across our portfolio in response to consumer demand for new Scotch flavour profiles in mature and emerging whisky markets continues to prove to be the key ingredient in our ability to rebound and successfully navigate towards a post-pandemic economy.”
Chivas Brothers also stressed the importance of a reduction of the 150% tariff on Scotch Whisky in India during the ongoing UK-India trade agreement (FTA) negotiations. Mr. Gourgues said: “The high costs and complex regulations of exporting Scotch to India has made it harder for Indian whisky fans to enjoy a wide range of Scotch whiskies. This is unfortunate because we know there is great appreciation for Scotch in India; reduced tariffs would bring greater choice at the top end of the market and boost India’s own whisky production which uses imported Scotch as a key ingredient.”
Mr. Gourgues also unveiled findings of recent commissioned research with EY that show how an ambitious UK trade policy could bring further gains for the UK Spirits sector. Mr. Gourgues said: “Lowering tariffs and tackling non-tariff barriers could raise UK spirits exports in emerging markets such as Brazil and Nigeria. We therefore urge the UK Government to secure improved market access in countries which are not yet a priority for trade deals and plan for the next generation of FTAs.”