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☆ Spirits giant Diageo's shares suffer Latin American hangover
▼ + stars: | 2023-11-10 | by ( Eva Mathews | ) www.reuters.com time to read: +2 min

"Macroeconomic pressures in the region are resulting in lower consumption and consumer downtrading," the world's biggest spirits maker said. Last month, Mexico's Becle (CUERVO.MX), the world's largest tequila producer, said economic challenges in Europe and Latin America were slowing customer spending on liquor, which battered its profits. "Over time, as inflation moderates and productivity from our supply agility program flow through, we expect operating profit to grow ahead of organic net sales growth," Diageo said. Diageo narrowly beat earnings estimates for the year ended June 30, as sales of its more expensive liquor brands offset lower volumes. Reporting by Eva Mathews in Bengaluru; Editing by Rashmi Aich, Emelia Sithole-Matarise and Alexander SmithOur Standards: The Thomson Reuters Trust Principles.

Persons: Clodagh, Johnnie Walker, Julio, Sophie Lund, Yates, Hargreaves Lansdown, Mexico's, Eva Mathews, Rashmi Aich, Emelia, Alexander Smith Organizations: REUTERS, Caribbean ., Diageo, Thomson Locations: Dublin, Ireland, North America, Africa, Latin America, Europe, America, Bengaluru

MEXICO CITY, Oct 26 (Reuters) - Mexican distiller Becle (CUERVO.MX), the world's largest tequila producer, lost $1.54 billion in market capitalization from a share selloff on Thursday after a stronger peso battered profits. Mexican firms' foreign income was devalued by gains in the peso, which strengthened 14% to the dollar over the year ending Sept. 30. Becle said it would continue shifting into the premium-priced liquor market and planned capital spending in the lower range of $200 million to $225 million this year. When stripping out the effects of foreign exchange, annual sales should still grow by a high-single digit percentage, Becle said. ($1 = 18.1430 Mexican pesos)Reporting by Sarah Morland; Editing by Kylie Madry and Rod NickelOur Standards: The Thomson Reuters Trust Principles.

Persons: Becle, Jose Cuervo, Gordon Dron, Morgan, Sarah Morland, Kylie Madry, Rod Nickel Organizations: MEXICO CITY, Itau, J.P, Thomson Locations: MEXICO, U.S, Europe, America

☆ Cuervo tequila maker Becle narrows sales guidance after profit slump
▼ + stars: | 2023-04-28 | by ( Isabel Woodford | ) www.reuters.com time to read: +2 min

Becle, which produces the popular Jose Cuervo tequilas, now forecasts annual growth in the high single digits, down from a February guidance for "high single digits to low teens." Becle posted a nearly 10% slump in first-quarter net profit this week as price increases failed to cushion negative currency exchange effects, high inflation and supply chain issues in Latin America. Executives on Friday added it was too early to assess the impact of recent price increases in places like Mexico. In afternoon trading, Becle's share price was down nearly 5%. While the industry has struggled with extended shortages of glass, used to bottle spirits, Becle executives said these appeared to be easing and should have limited performance impact for the remainder of 2023.

European demand is deepening a shortage of agave, the prickly plant native to Mexico's Jalisco region that's used to make tequila. Tequila prices have leapt. Compounding matters, the flow to Europe of high-quality 100% agave tequila - which has to be bottled in Mexico - has also been constrained by the supply-chain chaos from COVID-19. Michael Merolli, head of Pernod Ricard's tequila business, which includes Olmeca, said there were far fewer tequila brands in Europe than the United States, where the market was more mature and competitive, with new brands emerging every week. U.S. A-listers like Dwayne "The Rock" Johnson, Kendall Jenner and Kevin Hart have all launched tequila brands in recent years.

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