U.S. consumers venturing out more to drink at bars & restaurants
on 01/09/11 at 5:31 pmIndustry
Top executives at liquor maker Brown-Forman Corp. are pointing to signs that U.S. consumers are becoming more willing to venture out to drink at bars and restaurants — a crucial part of the spirits business that’s referred to as “on premise” consumption.
The recession staggered those sales as more people stayed home and spent less.
In reporting its first-quarter earnings Wednesday, Brown-Forman reported an acceleration of its U.S. business, fueled by its flagship Jack Daniel’s brand and sales for super-premium brands that fetch higher prices.
Chief Financial Officer Don Berg talked about prospects for growth in the U.S. market during a conference call with industry analysts.
QUESTION: Just curious … if you think that this acceleration is sustainable?
ANSWER (CFO Berg): On premise seems to be now growing. … It’s an improvement. It’s probably not as healthy as what we would like to see. But it’s certainly better than what we were seeing over the course of the past two to three years.
And so that’s all very encouraging. There is a lot of obvious uncertainty out there from the standpoint of what a lot of the things that are happening to the economy today are going to translate to down the road. We do keep our eye on consumer confidence levels, and they’ve bounced around quite a bit. And they’ve taken a bit of a dip here more recently.
So there still continues to be concern on the horizon. We hope it can be sustainable.”