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The Italian liquor giant’s shift to its own distribution platform aimed at creating a launch pad for the African market.
The Italian liquor giant’s shift to its own distribution platform aimed at creating a launch pad for the African market.

Gruppo Campari aims to double African growth

LIQUOR NEWS

By Marc Hasenfuss - Sep 11th 2017, 09:17

Italian liquor giant Gruppo Campari, which started handling its own distribution in SA at the start of 2017, aims to double its revenue flows from African markets in the next few years. 

Gruppo Campari CEO Bob Kunze-Concewitz said on Thursday that revenue derived from African markets — mainly SA, Nigeria, Angola as well as an East African presence — would in percentage terms represent high double digits of total sales generated in the group’s southern Europe, Middle East, and Africa (Semea) segment.

He said that in the six months to end-June, African business represented just 3% to 4% of the €258m sales generated in the Semea hub. The South African market was 1% of total sales.

Gruppo Campari contests the super-premium liquor brand range and has carved strong niches in SA and Africa with brands such as Campari, Skyy Vodka, Aperol, sipping tequila Espolon, Bulldog Gin, and Wild Turkey bourbon. Until the start of 2017, Gruppo Campari distributed its products in SA via local liquor firm Edward Snell.

The shift to its own distribution platform was aimed at creating a launch pad for the African market.

Kunze-Concewitz said the new arrangement was working well. "We enjoyed significant brand growth in our relationship with Edward Snell. But as our portfolio grew and their portfolio grew, there were, inevitably, prioritisation issues."

Gruppo Campari SA MD Jason Schmidt said the company had carved a leadership position in the premium vodka market with Skyy, while Bulldog Gin and Aperol were also registering strong market share gains.

Kunze-Concewitz said the group was still on the outlook for acquisition opportunities but conceded that deal pricing was a challenge, with transactions executed at ebitda (earnings before interest, tax, depreciation, and amortisation) multiples of about 17 times. "Some deals have been done at 20 times ebitda … even 30 times."
© BusinessLIVE MMXVII 

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