The company said that its net group sales for the first three months of 2004 were €151.3. This was an 11 per cent increase when taking into account the negative currency effect, and neglecting this change, the company achieved a 15.5 per cent increase. But the company has only reported an organic growth rate of 5.4 per cent.
The weakened US dollar had a negative affect of 3.6 per cent on the company's results, and the group claims that its strong results were driven by the consolidation of Barbero 1891.
It acquired the Barbero 1891 in December 2003 in a move to strengthen its position in the global spirits and wine sector. The company's newly acquired brands such as Aperol, which was already established in the Italian medium-alcoholic market, performed well in the first three months. It recorded volume growth of 26.8 per cent compared to the first quarter of last year. Campari said that the sales of its new brands made a strong contribution to the results.
This coupled with the the performance in its established businesses, allowed Campari to secure a 19.6 per cent increase in its Italian business - its best performing sector. It was responsible for €86.3 million of the company's €151.3 million in the first three months.
Its spirit business, which accounted for 64.5 of its total sales, recorded a positive performance of 10.6 per cent and saw organic growth of 3.3 per cent.
Its brands performed well in Brazil, Japan, and a number of the group's European businesses. Its shareholders increased their stocks in December last year in view of the increase in excise duties on alcohol, which became effective on January 1 2004. The group claims that the change in its advertising strategy drove German sales.
The company's European sales increased by 7.4 per cent as a result of these factors, while its rest of the world sales increased dramatically by 42.8 per cent. The company almost doubled its sales from 2.6 million in the same quarter last year, to 3.7 million this year. This is evidently a strong increase for the sector, but in comparison to its other regions, the rest of the world area is still its smallest business activity.
In the Americas, the company's sales suffered as a result of over optimistic expectations over the Christmas period. Its brands in the US took a -3.4 per cent hit in the first quarter and its sales dropped from 34.2 million to 33.2 million this year. But the main factor that decreased the sector's sales was the negative impact of the weak US dollar.
The company said that its wine business grew by 29.5 per cent in Q1 2004 and witnessed organic growth of 20.5 per cent. Its Cinzano sparkling wines brand performed well in the German and Italian markets and overall its sales grew by 18.7 per cent at constant exchange rates. External growth, the company said was almost entirely due to sales of Barbero 1891, in particularly the Mondoro and Enrico Serfino brands.
Its soft drinks business accounted for 20.9 per cent of total growth and sales were generated mostly in the Italian market. Its Lipton ice tea and Lemonsoda drinks sales contributed to this increase.