Staff at the new Chivas office on Blythswood Square, Glasgow, with (left to right) Christian Porta, CEO of Pernod Ricard EMEA and Latan, Alex Ricard, CEO and Chairman of Pernod Ricard and Jean-Christophe Coutures, CEO of Chivas Brothers.
By Democrat reporter
Chivas Brothers, the Kilmalid, Dumbarton-based Scotch Whisky business of Pernod Ricard, is doing well despite the ongoing challenges of Covid-19.
Total organic sales were down -11% as a result of the global COVID-19 crisis and in particular its severe impact on Global Travel Retail.
Chivas Brothers’ Strategic International Brands (The Glenlivet, Ballantine’s, Chivas and Royal Salute) saw a sales drop of –10%, however, a more detailed evaluation of their performance tells a story of resilience and recovery.
Looking at its Strategic International Brands performance in domestic markets only, Chivas Brothers’ organic sales fell –3%, with its Scotch portfolio gaining share in nine of the top ten markets covered by Nielsen*, with a particularly strong performance in North America +3%.
The Glenlivet consolidated its leadership in the Single Malt category in the US, growing +16% (Nielsen value MAT) in spite of the combined challenges of the pandemic and US tariffs, thanks to successful new launches including The Glenlivet 14 Year Old and The Glenlivet Caribbean Reserve off the back of the new Original By Tradition campaign.
Global growth for the brand stands at +2%, demonstrating its strong H1 performance and the speed of its recovery in H2, which includes +60% growth in China in addition to gains in Eastern Europe, the UK and Taiwan.
Strong performances in key regions such as North America and Eastern Europe, as well as in domestic markets with fewer social restrictions such as Taiwan and Korea, have helped offset the heavily-impacted Global Travel Retail channel.
Community involvement – some of the participants in a historical pageant sponsored by Chivas in Dumbarton’s Levengrove Park.
Ballantine’s had an exceptionally strong H1 as the biggest brand contributor to overall Scotch category growth (IWSR 2019), but closed the year at – 8%, predominantly driven by the impact of COVID-19 on the Ballantine’s prestige range in Global Travel Retail. Flagship blend Ballantine’s Finest (- 3%) showed strong resilience and gained share in most key markets, including Eastern Europe, France, Germany, Brazil and India.
Chivas was heavily impacted by its exposure to Travel Retail, with lockdowns and travel restrictions across many of its key markets, resulting in a -17% decline in organic sales.
Despite this, the brand recorded growth in 34 markets – with particularly favourable performances in Turkey, Russia and Germany – thanks to innovation and the activation of its “Success is a Blend” campaign and Manchester United partnership in 60 and 40 markets respectively.
Although its exposure to Travel Retail led to a -2% drop for Royal Salute, the luxury Scotch maintained momentum in its key strongholds of Taiwan, where it grew by +25%, and Korea.
Jean-Christophe Coutures, Chairman and CEO of Chivas Brothers, said: “Our business and brands have responded with agility and resilience in the face of unprecedented market conditions, in many instances outperforming the category.
Strong performances in key regions such as North America and Eastern Europe, as well as in domestic markets with fewer social restrictions such as Taiwan and Korea, have helped offset the heavily-impacted Global Travel Retail channel.
We remain confident in the strength of our portfolio and the Scotch category as a whole, especially in its ability to withstand and overcome external challenges.”
Chivas Brothers used the opportunity to announce a number of investments being made in the coming year and for the long-term, including support of Scottish tourism with a £2.5 million investment in The Glenlivet brand, a partnership with the National Trust for Scotland to uncover the history of illicit distilling across the country, and a new farmer collaboration programme to drive innovation and sustainable agriculture for the company’s Single Malts portfolio.
The forthcoming launch of Ballantine’s 7 Bourbon Finish – a new 7-year-old bourbon-finished expression of the leading blend – was also revealed.
Chivas Brothers was NHS Scotland’s first pro-bono hand sanitiser supplier. This is the first consignment being loaded up at Dumbarton.
Mr Coutures also provided an update on how Chivas Brothers implemented an industry-leading Safe System of Work at its sites, and came to the aid of its community at the height of the pandemic, producing over 160,000 litres of hand sanitiser and making over 300 contact-free deliveries to distribute it to local social care providers and charities.
In May, Chivas Brothers was named NHS Scotland’s first pro-bono hand sanitiser supplier.
He commented: “Our people remain our priority and the safety and well-being of our teams, communities and ecosystem will continue to drive our business decisions moving forward.”