CHICAGO — Some like it neat. Others prefer it on the rocks. But a rare glimpse of Beam Suntory’s financial health showed about what one might expect: We Americans enjoy our whiskey.
Suntory Holdings, the public parent company of privately held Beam Suntory, reported last week that Beam Suntory sales saw mid-single-digit growth in the nine-month period ending Sept. 30 when compared with the same period a year earlier. Brands such as Jim Beam, Jim Beam Apple and Maker’s Mark are slaking the thirst of whiskey-craving Americans, even as Beam Suntory makes further inroads with Japanese consumers.
Put simply: Whiskey is having a moment and that moment could last years. A recent Moody’s report estimated that Western brown spirits, particularly whiskey, would remain the fastest growing segment of the spirits industry globally. Though that growth could slow, the report said, the spike in popularity for brown spirits — which began in the early 2000s — could last 20 to 30 years.
“This is because it takes years (due to aging) for whiskey supply to catch up with consumer demand,” according to the Moody’s report.
It’s not all bourbon. Beam Suntory sales growth in the U.S. was also supported by its Scotch and Japanese whiskies, and brands such as Courvoisier, Hornitos tequila and Effen vodka, the Suntory Holdings release noted.
But bourbon and Tennessee whiskey sales in the U.S. have boomed in recent years, with sales of about $2.9 billion in 2015, more than double the $1.3 billion in 2003, according to the Distilled Spirits Council of the United States.
Overseas sales
Increasingly, Jim Beam is big in Japan, too. Year-to-date sales volume is up 44 percent in Japan, where the bourbon is marketed for highball cocktails, according to Suntory Holdings.
Globally, according to the Moody’s report, dollar sales of whiskey will continue to outpace volume sales because of “premiumization,” which essentially means consumers paying more for higher quality products.
That’s as true for Jack as it is for Jim. Brown-Forman, a Beam Suntory competitor, reported in August that the Jack Daniels brand family continues driving underlying net sales growth. But pricier whiskeys such as Woodford Reserve and Gentleman Jack saw more dramatic, double-digit growth.
Likewise, in July, Diageo reported whiskey, including brands such as Bulleit and Crown Royal, fueled its North American sales growth.
And while it remains to be seen whether craft spirits, an ambiguously defined term, can catch on like craft beer, there’s evidence to suggest large spirits companies see money to be made in smaller, local distilleries. Last month, Constellation Brands bought Utah-based High West Distillery for $160 million. Last year, Bacardi acquired Angel’s Envy for about $150 million.