Emperador heady as profit hits P7.7B

Tycoon Andrew Tan-led Emperador Inc. grew its net profit last year by 11 percent to P7.7 billion on higher margins from its global liquor businesses.

Emperador, now the world’s largest brandy company and owner of Scotch whisky brand Whyte and Mackay as well as some Spanish brandy and sherry brands led by the iconic Fundador, also cited improved cost efficiency.

In a disclosure to the Philippine Stock Exchange on Monday, Emperador reported consolidated revenues of P41 billion, down by 6 percent from the previous year.

“Driven by high-margin brandy and whisky products, we have been able to sustain our earnings growth. Our earnings growth per annum from 2011 to 2016 is 27 percent,” said Emperador president Winston Co.

“We also managed to realize our highest quarterly earnings in the fourth quarter of 2016, amounting to almost P2.8 billion and reflecting an increase of 23 percent over the fourth quarter of 2015,” he said.

Irvine, California-based G.K. Skaggs is also expected to start selling Emperador Brandy and Emperador Light in major US markets early this year.

“With market penetration in 51 countries today, Emperador Brandy has evolved into a global brand. We believe that our export business will grow over time,” Co said.

Tan first visited Jerez, Spain in 1983 to learn the art of brandy-making. Inspired by the success of Spanish brandy Fundador in the Philippines, he decided to venture into this business under a new brand “Emperador.”

Decades later, Tan saw a string of opportunities to buy more businesses as liquor-hub Europe underwent tough times. In early 2013, Emperador gained a foothold there with the acquisition of Bodega San Bruno S.A., a brandy company based in Jerez, Spain. The deal included the acquisition of the San Bruno trademark, which has been registered since 1942, as well as vineyards and a  sizeable inventory of high-quality and well-matured brandy.

Shortly after, Emperador boosted overseas production capability with the acquisition of 409 hectares of additional vineyard in Madrid,  bringing close to 1,000 hectares its landbank in Spain.

Emperador further expanded its offshore interest by investing P3.7 billion to acquire a 50-percent stake in integrated brandy producer Bodega Las Copas S.L., a unit of Spain’s popular sherry bodega González Byass in early 2014.