Emperador profit rises in 2016 on higher brandy, whisky sales
EMPERADOR, INC., the liquor maker owned by tycoon Andrew L. Tan, sustained its growth momentum last year, reaping the fruits of a global acquisition binge that resulted in margin improvements.
The world’s largest brandy company saw its net profit rise 11% to P7.7 billion last year after earnings climbed 23% to a record P2.8 billion in the fourth quarter.
The increase in profit was a product of higher margins due to cost efficiency, Emperador said.
“Driven by high-margin brandy and whisky products, we have been able to sustain our earnings growth. Our earnings growth per annum from 2011 to 2016 is 27%,” Emperador President Winston S. Co was quoted in the statement as saying.
Emperador has been on an acquisition spree to build a global liquor empire that kicked off with the £430-million takeover of whisky maker Whyte & Mackay Group Limited in 2014.
Whyte & Mackay is the fifth largest Scotch whisky manufacturer in the United Kingdom. Its products include British luxury brand The Dalmore Single Highland Malt, Jura Premium Single Malt, and Whyte & Mackay Blended Scotch whiskies.
In February 2016, Emperador sealed an agreement with Beam Spain, S. L. for the purchase of its brandy and sherry businesses for € 275 million.
The acquisition included iconic brands Fundador Pedro Domecq, the Philippines’ largest selling premium imported brandy brand; Terry Centenario, Spain’s no. 1 selling brandy; Tres Cepas, Equatorial Guinea’s no. 1 brandy; and Harveys, United Kingdom’s no. 1 selling sherry wine.
Aside from the liquor brands, Emperador took over Bodegas Fundador, known as Spain’s largest and oldest brandy cellars, along with the production facilities, vineyards and state-of-the-art blending and bottling facilities located in Jerez. It also bought a brandy distillery in Tomelloso.
In December, Emperador announced its subsidiary Bodegas Las Copas agreed to buy the Domecq brandy and sherry businesses of Pernod Ricard S. A. in Mexico for an undisclosed price.
“With market penetration in 51 countries today, Emperador Brandy has evolved into a global brand. We believe that our export business will grow over time. And with the acquisition of Fundador last year, our brandy business is stronger than ever before,” Mr. Co said.
California-based G.K. Skaggs, a premium beverage importer and distributor, will start selling Emperador Brandy and Emperador Light in major US markets within the first quarter.
Emperador is part of Alliance Global Group, Inc. — the holding firm for Tan’s real estate, consumer goods, quick service restaurants, hotel and gaming businesses.
Shares in Emperador shed five centavos or 0.81% to end at P6.10 apiece on Monday.