January 31, 2014 – Here are some of the headlines in this week’s whisky industry news:
LVMH has named Marc Hoellinger the full-time CEO of The Glenmorangie Company effective February 1. Hoellinger has been the acting CEO and President since September, when Paul Skipworth took a leave of absence for personal reasons. Hoellinger has also been serving as the director of marketing strategy for Moet Hennessy’s wines and spirits, where he has been based in Paris since 2011. Hoellinger was previously Glenmorangie’s director of international marketing and communications, and will now move to the company’s downtown Edinburgh headquarters in The Cube. Skipworth will stay with Moet Hennessy as a senior vice president for strategy.
Lagging sales in China and other developing whisky markets is hurting the bottom line for Diageo. The world’s largest spirits company reported a 1.8% increase in global sales for the first half of the fiscal year Thursday, after posting a 2.2% gain during the first quarter. Chief Financial Officer Deirdre Mahlan told analysts she expects sales to rise in the second half of the year, but declined to predict by how much. The company’s sales in China fell 22% over the previous year, largely because of Chinese crackdowns on gifting and personal spending by government officials. Sales also fell in other Asian nations, most of Africa with the exception of South Africa, and slightly in Europe on weak economies in Ireland and Southern Europe. North American sales gained about 5%.
Diageo CEO Ivan Menezes is pledging $200 million in annual savings from budget cuts to be implemented between now and 2017, as he puts a “flatter” management structure into place. He also refused to rule out additional acquisitions, and told reporters that the company will look at acquiring global brands as they become available. However, most of the remaining large global brand owners, such as Brown-Forman, are family-controlled, which makes acquisitions difficult to accomplish. He also addressed September’s Scottish independence referendum for the first time, urging both the Scottish and UK governments to avoid any major policy changes that could add any burdens to the Scotch whisky business. Diageo depends on Scotch whisky sales for about 30% of its annual sales.
LVMH reported a 9% gain in profits from its wine and spirits units for the 2013 calendar year. CEO Bernard Arnault cited consistent sales growth in Asia and the US, while European sales grew in what he described as a “challenging economic environment.”
San Antonio, Texas-based Ranger Creek Brewing & Distilling will sell its whiskies outside of Texas for the first time when the Small Caliber series goes on sale in Nashville, Tennessee starting February 7. Ranger Creek head distiller T.J. Miller is an alumnus of Nashville’s Vanderbilt University, and in a news release, Miller cited the city’s strong support for artisanal distilleries as one of the key reasons for entering the market.
Beam plans to build a new 600,000 square foot distribution center in Franklin County, Kentucky, with construction to begin by the end of February. The new facility will handle distribution and logistics for distilled spirits bottled at Beam’s bottling plant in nearby Frankfort, and is expected to create 60 full-time jobs. The center will be managed by a logistics company to be named later this year.
The Spencerfield Spirit Company is releasing a new blended malt Scotch whisky for sale in the UK. The Feathery is named for one of the earliest golf ball designs — a leather pouch stuffed with feathers. The whisky is blended from malts matured in sherry casks, and bottled at 40% ABV with no age statement. Pricing information was not made available.