MEXICO CITY (Reuters) -Mexico’s Becle, the world’s largest tequila producer, on Wednesday posted a 18% fall in first-quarter net profit from a year earlier, still landing above analyst forecasts, as it sold fewer alcoholic drinks and was hit by foreign exchange effects.
Profits for the first three months of 2024 landed just over 1 billion pesos ($61 million), the distiller said, as core earnings slipped 1% from revenues down 7% to 8.96 billion pesos.
The company nevertheless ended the quarter above the 900 million peso profit forecast by analysts polled by LSEG, even though sales fell beneath their average estimate of 9.29 billion pesos.
“We entered 2024 with momentum despite challenging macroeconomic conditions and slowing consumption in several of our markets,” Becle said in a statement, adding that its strategy so sell more premium-priced liquors was having positive results.
Becle sold 5% more volumes in its largest market, the United States and Canada, while in Mexico volumes slipped 10% and elsewhere they fell 23%, as customers bought less tequilas and spirits but more non-alcoholic drinks.
Jose Cuervo and other tequilas make up the bulk of Becle’s sales, though it also sells other liquors such as Kraken rum and Boodles gin. Non-alcoholic drinks made up just 3% of sales this quarter.
Becle said sales in North America were further hit by the strong Mexican peso, which strengthened 8% against the U.S. dollar by the end of March, diluting income from abroad.
(Reporting by Sarah Morland, Marion Giraldo and Aida Pelaez-Fernandez; Editing by Brendan O’Boyle)
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