Distillers & Vintners

More than 100 workers at Diageo's Cameronbridge distillery, Europe's largest grain distillery, will walk out from Sept 28 for three weeks in a dispute over plans to cut 10 jobs at the site, threatening supplies of Johnnie Walker, Bell's and Haig whisky. The action could halt production at the factory, which makes the grain spirit used in blends for some of Diageo's best-known whiskies, and marks the first bout of strike action since Sir Dave Lewis announced a sweeping cost-cutting drive at the drinks giant. Sir Dave, nicknamed "Drastic Dave" for his aggressive approach to cutting costs, took over as Diageo's chief executive in January and is targeting $1bn (£750m) of savings; Diageo employed 27,938 people at the end of June, down by almost 2,000 from a year earlier, while it spent $514m on redundancy payments. Unite, the union overseeing the strike, accused Diageo of failing to consult workers properly, with general secretary Sharon Graham saying there is no justification for slashing hundreds of jobs across its operations when it is raking in hundreds of millions of profit. Diageo said the Cameronbridge dispute was limited to 10 roles, with eight people affected because two of the positions are vacant, and that the cuts were necessary because it had reduced production at the distillery and expected to maintain lower levels of grain distillation over the next few years.

Unite members at Diageo's Cameronbridge distillery in Leven, Fife, will walk out on Monday September 28 in a dispute over jobs, with strike action due to last until just before 6am on Thursday October 15. Different groups of workers, including distillation and process controllers, distillery and machine operators, technicians, quality control analysts, process chemists and engineers, will strike on different days in a series of targeted protests. Unite believes the action will halt production at the site, which it describes as Europe's largest grain distillery and which produces millions of litres of spirit each year. The union says Diageo is to cut hundreds of jobs across Scotland as part of a global restructuring process, with dozens of roles at Cameronbridge potentially lost. Unite general secretary Sharon Graham said there is no justification for slashing hundreds of jobs while the company is raking in hundreds of millions of profit, and deputy Scottish secretary Dougie Maguire warned that if Diageo fails to halt the proposals, strikes will bring production to a standstill. Diageo has been contacted for comment.

Constellation Brands warned that higher transportation and commodity costs will weigh on gross profit margins in the second half of the year, sending shares down more than 4% and marking the ninth decline in ten sessions. The margin pressure stems from logistics inflation and volatile commodity hedges, but management remains confident in its long-term outlook, citing underlying pricing power and early signs of normalized consumption. At the Barclays Annual Global Consumer Conference in Boston, CEO Nicholas Fink said the parent of Modelo and Corona is shifting from expansion to operational efficiency and cost optimization, measures expected to boost profits despite sluggish sales. The company reiterated its fiscal 2027 targets of reported EPS between $11.50 and $12.20 and comparable EPS between $11.20 and $11.90, with enterprise organic net sales seen down 1% to up 1%.

Schloss Wachenheim, the Germany-based sparkling-wine group, reported preliminary annual results that fell short of its own forecasts, with sales inching up just 0.3% to €448.9m ($521.9m) for the year to 30 June, versus a projected 3% rise. Volume sales increased 2.4% to 229.6 million 750ml bottles, but the company's fourth-quarter performance "fell short of expectations" across all divisions. EBIT came in at approximately €27.6m, up from €27.2m a year earlier but below the €30-33m forecast, while net income after taxes of around €16.4m exceeded the prior year's €16.2m but missed the €18-21m range. The company will publish its full annual results later this month.

Diageo is cutting 305 roles at its North America headquarters as part of a cost-saving and turnaround plan under its recently appointed CEO, marking a material change in its largest market. The company, valued at £37.1 billion, produces and distributes alcoholic drinks globally, and this restructuring aims to reshape its operating model and support wider turnaround efforts. The move tests Diageo's premiumization narrative, which relies on premium brands and efficiency to drive growth and margins. While management sees streamlined assets and tighter execution as positives, analysts flag execution risks and potential constraints on brand investment if trading remains tough. Comparisons are drawn with peers Pernod Ricard and Brown-Forman.

Brown-Forman Corporation reported first-quarter fiscal 2027 earnings of 38 cents per share, up 6% year over year and meeting the Zacks Consensus Estimate, while net sales of $911 million declined 1% and missed the consensus mark of $921.2 million by 1.1%. The top line was pressured by the end of the Korbel relationship, lower used barrel sales, and tequila weakness, but Ready-to-Drink sales rose 20%, led by a 48% jump in New Mix. Gross profit fell 1% to $549 million, with gross margin expanding 40 basis points to 60.2%, while operating income declined 3% to $252 million on a reported basis but increased 4% organically. The company reaffirmed its fiscal 2027 outlook for organic net sales to be approximately flat and organic operating income to decline 3-5%, projecting an effective tax rate of 20-22% and capital expenditure of $60-$70 million.

Brown-Forman, the maker of Jack Daniel's, warned that alcohol demand in developed markets is likely to remain weak through fiscal 2027, as the company reported first-quarter net sales of $911 million, down 1% year over year and slightly below analysts' expectations of $914.9 million. Despite the sales miss, adjusted earnings of $0.38 per share beat estimates of $0.37, and management maintained its full-year outlook for flat organic sales and a 3%–5% decline in organic operating income. The company cited cautious U.S. consumers, health-conscious behavior, and growing GLP-1 use, with weakness also in Germany, France, and the UK. Canada remains a major headwind, as U.S.-made spirits are still absent from shelves in most provinces, a situation the CEO expects to continue for the rest of the fiscal year. Brown-Forman's ready-to-drink business grew 20% in the quarter, but whiskey sales were flat and tequila sales fell 12%, with Herradura and el Jimador under pressure. The planned retirement of CEO Lawson Whiting adds uncertainty as the company navigates weak demand and changing consumer preferences.

Huazhi Liquor Chain released its semi-annual report, with revenue of 3.249 billion yuan, down 17.72% year on year, and a net loss attributable to the parent of 73 million yuan, down 230.67% year on year, marking its first interim loss in over a decade. The loss mainly stemmed from a back-tax payment of 127 million yuan. Excluding that impact, non-GAAP net profit was 39 million yuan, up 18.72% year on year. The company's baijiu business gross margin was only 6.53%, down 2.17 percentage points year on year, compared with a gross margin as high as 22.9% in the same period of 2021. To cope with the industry adjustment, Huazhi Liquor Chain proactively scaled back purchasing, with prepayments down 49.31% year on year and inventory down 42.13% year on year. Meanwhile, it opened 173 new stores, bringing the total to more than 2,000, and stepped up investment in instant retail as it transforms into a liquor terminal service provider.

Brown-Forman B reported quarterly earnings of $0.38 per share, in line with the Zacks Consensus Estimate and up from $0.36 a year ago. Revenue for the quarter ended July 2026 came in at $911 million, missing the consensus by 1.11% and down from $924 million in the prior year. The company has beaten revenue estimates three times in the last four quarters but has surpassed EPS estimates only once in that period. Following the report, the stock carries a Zacks Rank #4 (Sell), indicating expected underperformance in the near term. Brown-Forman B shares have gained about 1.2% year to date, compared with the S&P 500's 11.5% rise.

Swellfun released its 2026 interim report, showing the company swung from profit to loss, with net profit attributable to the parent company at negative 6.2225 million yuan, a decrease of 112 million yuan compared with the same period last year, down 105.90 percent year on year. Total operating revenue was 1.082 billion yuan, down 27.78 percent year on year. Net cash flow from operating activities was negative 73.2514 million yuan. The company's gross margin was 76.13 percent, down 3.12 percentage points year on year. Return on equity was negative 0.12 percent, down 2.31 percentage points year on year. Diluted earnings per share was negative 0.01 yuan, down 105.89 percent year on year.

Shanxi Fenjiu released its 2026 interim report. Total operating revenue was 21.044 billion yuan, down 12.18% year-on-year, and net profit attributable to the parent was 6.439 billion yuan, down 24.29% year-on-year. Net cash inflow from operating activities was 6.652 billion yuan, up 11.23% year-on-year. The company's asset-liability ratio was 39.34%, gross margin was 75.40%, ROE was 16.90%, and diluted earnings per share was 5.28 yuan. Total asset turnover was 0.35 times, and inventory turnover was 0.35 times. The number of shareholders was 117,900, and the top ten shareholders held 75.05% of total share capital.

Shanxi Fenjiu disclosed its semi-annual report on August 30. In the first half of 2026, it achieved operating revenue of 21.044 billion yuan, down 12.18% year-on-year; net profit attributable to shareholders of the listed company was 6.439 billion yuan, down 24.29% year-on-year; basic earnings per share were 5.2783 yuan.

Shanxi Fenjiu released its 2026 interim report. In the first half, operating revenue was 21.04 billion yuan, down 12.2% year-on-year; net profit attributable to the parent was 6.44 billion yuan, down 24.3%; net profit attributable to the parent after deducting non-recurring items was 6.44 billion yuan, down 24.4%; net operating cash flow was 6.652 billion yuan, up 11.2%; earnings per share were 5.2783 yuan. In the second quarter, operating revenue was 6.12 billion yuan, down 17.7% year-on-year; net profit attributable to the parent was 1.06 billion yuan, down 43.1%. As of the end of the second quarter, the company's total assets were 63.676 billion yuan, up 13.1% from the end of the previous year; net assets attributable to the parent were 38.092 billion yuan, down 3.9% from the end of the previous year. The company said its main business remained unchanged, still the production and sale of Fenjiu, Zhuyeqing and Xinghuacun liquor, and it continued to promote product research and development and market expansion.

Diageo has slashed its workforce by more than 6% as part of a cost-cutting blitz under new CEO Dave Lewis, with further layoffs expected by September 1. The company's annual report revealed an average of 27,938 full-time employees by the end of June, down from 29,860 a year earlier. The cuts are part of a program to lower operating costs by nearly $1 billion over three years, with savings earmarked for growth initiatives such as price reductions and expansion in canned cocktails and Guinness. Diageo's revenues fell 2% organically to $19.6 billion for the year ending June 30, while operating profits dropped 27% to $3.2 billion, hit by $900 million in restructuring charges and a $1.5 billion impairment in Turkey. The company also abandoned its medium-term growth target of 5% to 7% in favor of a low-single-digit outlook, as North American sales declined 8.4% in fiscal 2026.

Laobaigan Liquor released its 2026 interim report. Total operating revenue was 2.104 billion yuan, down 15.23% from the same period last year. Net profit attributable to the parent company was 262 million yuan, down 18.47% year-on-year. Net cash inflow from operating activities was 191 million yuan, an increase of 237 million yuan compared with the same period last year. The company's asset-liability ratio was 35.96%, gross margin was 63.45%, return on equity was 4.80%, and diluted earnings per share was 0.29 yuan. The number of shareholders was 160,500, and the top ten shareholders held 36.80% of total share capital.

Jinfeng Wine released its 2026 interim report. Total operating revenue was 189 million yuan, and net profit attributable to the parent company was negative 5.762 million yuan, an increase of 1.374 million yuan compared with the same period last year, marking two consecutive years of improvement. Net cash flow from operating activities was negative 91.3477 million yuan. The asset-liability ratio was 11.06 percent, and the gross margin was 42.50 percent, up 2.82 percentage points from the same period last year, marking three consecutive years of improvement. The latest return on equity was negative 0.30 percent, diluted earnings per share was negative 0.01 yuan, total asset turnover was 0.09 times, and inventory turnover was 0.18 times. The company had 46,100 shareholders, and the top ten shareholders held 281 million shares, accounting for 41.96 percent of total share capital.

Gujing Gongjiu released its 2026 interim report. Total operating revenue was 10.131 billion yuan, down 27.01% year-on-year, and net profit attributable to the parent company was 2.164 billion yuan, down 40.89% year-on-year. Net cash inflow from operating activities was 1.543 billion yuan, down 62.87% year-on-year. The company's latest asset-liability ratio was 32.38%, gross margin was 80.33%, ROE was 8.70%, and diluted earnings per share was 4.09 yuan. The number of shareholders was 57,500, and the top ten shareholders held 63.93% of the total share capital.

Jinzhongzi Liquor released its 2026 interim report. Total operating revenue was 236 million yuan, and net profit attributable to the parent company was negative 64.8388 million yuan, an improvement of 7.358 million yuan compared with the same period last year, with the loss narrowing year-on-year. Net cash flow from operating activities was negative 160 million yuan. The asset-liability ratio was 34.15%, and the gross margin was 49.08%, up 6.20 percentage points from the same period last year. Diluted earnings per share were negative 0.10 yuan. The number of shareholders was 106,400, and the top ten shareholders held 37.16% of total share capital.

Swellfun released its 2026 interim report, showing first-half operating revenue of 1.082 billion yuan, down 27.8% year on year, and a loss of 6.22 million yuan, down 105.9% year on year. Second-quarter operating revenue was 266 million yuan, down 50.7% year on year, while the net loss attributable to the parent widened to 177 million yuan. The company said the baijiu industry remains in a period of deep adjustment, and that it proactively adjusted shipment pace, cutting channel inventory by about 50% year on year, but this reduced operating revenue by about 300 million yuan and gross profit by about 250 million yuan. As of the end of the second quarter, total assets stood at 8.213 billion yuan and net assets attributable to the parent at 4.984 billion yuan.

Laobaigan Liquor released its 2026 interim report. Operating revenue for the first half was 2.10 billion yuan, down 15.2 percent year on year. Net profit attributable to the parent company was 262 million yuan, down 18.5 percent. Second-quarter revenue was 883 million yuan, down 32.8 percent, while net profit attributable to the parent company was 96.14 million yuan, down 42.9 percent. The company said that amid a deep adjustment in the baijiu industry and increasingly fragmented consumption scenarios, performance declined. It is optimizing its product structure, strengthening the competitiveness of its leading products, and accelerating online channel expansion by setting up an e-commerce subsidiary and exploring new instant retail formats.

Swellfun released its 2026 interim report. In the first half, it achieved operating revenue of 1.082 billion yuan, down 27.78% year on year, while net profit was negative 6.2225 million yuan, down 105.9% year on year. The company said the baijiu industry is undergoing deep adjustment, and that proactively optimising inventory and adjusting shipment pace led to lower revenue. Channel inventory in the first half fell about 50% compared with the same period last year, selling expenses dropped 29.57% year on year, administrative expenses fell 19.28% year on year, and net cash flow from operating activities improved by about 85.5% year on year. The company adhered to the prudence principle in making provisions, and factors including reduced government subsidies resulted in a negative net profit. Xiao Zhuzhuo, a China liquor industry analyst, said Swellfun is trading short-term pain for long-term health by proactively cutting inventory, reducing costs and improving cash flow, which will help restore a healthier channel cycle going forward.

Swellfun disclosed its 2026 semi-annual report on the evening of August 28. First-half revenue was 1.082 billion yuan, down 27.78 percent year on year, and net profit was a loss of 6.2225 million yuan, swinging from profit to loss compared with the same period last year. This is the company's first half-year loss in 12 years, since the first half of 2014. First-quarter revenue was 816 million yuan, with net profit attributable to the parent company of 171 million yuan. Second-quarter revenue was about 266 million yuan, with a net loss attributable to the parent company of about 177 million yuan. The overall first-half loss was mainly dragged down by the second quarter. The company said performance was affected by the proactive optimization of channel inventory structure and related phased factors. Channel inventory fell by about 50 percent year on year, but inventory still reached 4.082 billion yuan, accounting for nearly half of total assets, and inventory turnover days extended to about 2,785 days. On the personnel side, a round of streamlining was completed in 2025, with the total workforce reduced by a net 282 employees and one-off severance compensation of about 44 million yuan incurred. In 2026, the company is still continuing to shrink its headcount, and the core senior management team has been almost entirely replaced. Controlling shareholder Diageo is simultaneously advancing workforce reductions and has launched a restructuring plan totaling 1.2 billion US dollars, including 514 million US dollars in severance costs for Europe, corporate and other regions, an increase of more than seven times compared with the previous fiscal year. It also recorded asset impairments of 263 million US dollars for North America and Mexico and brand impairments of 1.5 billion US dollars. The final number of global layoffs has not yet been announced.

Laobaigan Liquor released its 2026 interim report on August 28. First-half operating revenue was 2.10 billion yuan, down 15.2% year on year, while net profit attributable to the parent company was 262 million yuan, down 18.5%, marking another period of declines in both revenue and profit. The company had achieved growth in both revenue and net profit in the first quarter, but second-quarter revenue was 883 million yuan, down 32.8% year on year, and net profit was 96.14 million yuan, down 42.9%. The company said the industry is undergoing deep adjustment, consumer recovery momentum remains weak, and top-tier national brands are pushing into lower-tier markets, squeezing regional liquor producers. As of the end of June, accounts receivable reached 42.37 million yuan, a surge of 649.98% from the beginning of the year, mainly due to an increase in credit sales. At the same time, the company significantly cut expenses, with selling expenses down 35.26% year on year and research and development expenses down 59.65%, while net operating cash flow turned positive at 191 million yuan. Performance among its brands diverged markedly: Wuling Liquor posted net profit of 130 million yuan, while Kongfujia Liquor recorded a loss of 2.81 million yuan. The company also invested 20 million yuan to set up an e-commerce subsidiary to coordinate the online business of its five major brands. In the secondary market, the stock closed at 11.63 yuan, down more than 26% for the year.

Gujing Gongjiu released its 2026 semi-annual report. In the first half, it achieved operating revenue of 10.131 billion yuan, down 27.01% year on year, while net profit attributable to shareholders of the listed company was 2.164 billion yuan, a year-on-year decline of 40.89%. Among these, the Year Original Pulp series, which is the absolute mainstay, achieved revenue of 7.965 billion yuan, down 27.32% year on year, contributing about 78% of the company's revenue and serving as the key factor dragging down performance. The Gujing Gongjiu series recorded revenue of 1.052 billion yuan, down 11.14% year on year, while Huanghelou and other series recorded revenue of 979 million yuan, down 34.57% year on year. By quarter, first-quarter revenue was 7.446 billion yuan, down about 18.6% year on year, while second-quarter single-quarter revenue was only 2.69 billion yuan, with the year-on-year decline widening to 43.3%, and net profit was 558 million yuan, plunging 58.1% year on year. The company said the baijiu industry is in a period of deep adjustment, with business banqueting and gifting demand contracting significantly. The company is actively working through inventory, and some markets outside its home province, such as Jiangsu, are showing signs of stabilising. On 28 August, Gujing Gongjiu shares closed up 1.88% at 93.90 yuan.

Laobaigan Liquor released its 2026 interim report, showing second-quarter revenue fell 32.75% year on year and net profit attributable to the parent company dropped 42.92%, far exceeding the 15% and 25% declines previously forecast by China Merchants Securities and Shenwan Hongyuan Securities. In the first half, the company achieved operating revenue of 2.104 billion yuan, down 15.23% year on year, and net profit attributable to the parent of 262 million yuan, down 18.47%. Contract liabilities stood at 954 million yuan, a sharp year-on-year decline of about 25%, indicating weakening willingness among distributors to make advance payments. By product, revenue from products priced above 100 yuan fell 18.10%, a larger decline than the roughly 12% drop for products below 100 yuan. By region, revenue in its Hebei home base slipped 16.05%, while the Hunan market posted the largest decline at 21.60%, and Anhui and Shandong also saw double-digit contractions. In the second half, the company will continue to prioritise actual consumption and bottle openings, abandon channel inventory loading, strictly control cross-regional selling and price chaos, deepen its presence in banquets, dining and group-buying scenarios, solidify its Hebei home base, and strengthen the Hunan market for Wuling Liquor.

Hebei Hengshui Laobaigan Liquor Co., Ltd. released its 2026 semi-annual report on August 28. In the first half of the year, operating revenue was 2.104 billion yuan, down 15.23 percent year on year, and net profit attributable to shareholders of the listed company was 262 million yuan, down 18.47 percent. Net profit after deducting non-recurring items was 252 million yuan, down 14.85 percent. The company said the decline stemmed from intensifying industry competition and slowing end-market sales, consistent with the overall trend in Hebei's baijiu industry. In the first half, enterprises above designated size in the province recorded operating revenue of 3.222 billion yuan, down 15.4 percent year on year, and total profit of 367 million yuan, down 50.1 percent. Despite the declines in revenue and net profit, net cash flow from operating activities turned from negative 45.8 million yuan in the same period last year to 191 million yuan, indicating improved inventory digestion and channel collections. As a regional leader, Laobaigan Liquor faces dual pressure from national famous brands pushing into lower-tier channels and intensifying competition within the province. Whether it can reach an inflection point in performance in the second half of the year deserves attention.

Gujing Gong Liquor released its 2026 interim report. First-half net profit attributable to the parent was 2.164 billion yuan, down 40.9% year on year. Operating revenue was 10.131 billion yuan, down 27.01% year on year. Net profit attributable to the parent after deducting non-recurring items was 2.15 billion yuan, down 40.7% year on year. Net operating cash flow was 1.543 billion yuan, down 62.9% year on year. Earnings per share were 4.09 yuan. In the second quarter, operating revenue was 2.69 billion yuan, down 43.3% year on year, and net profit attributable to the parent was 558 million yuan, down 58.1% year on year. As of the end of the second quarter, total assets were 38.438 billion yuan, up 0.6% from the end of the previous year, while net assets attributable to the parent were 24.891 billion yuan, down 0.6% from the end of the previous year. The company said its main business has not changed and it remains focused on the production and sale of baijiu. Facing a deep industry adjustment, it is actively adjusting its marketing strategy and channel development.

Brown-Forman Corporation is set to report first-quarter fiscal 2027 results on September 2, with analysts expecting a slight revenue decline but an earnings increase. The Zacks Consensus Estimate puts revenues at $921.2 million, down 0.3% from the year-ago quarter, while earnings are pegged at 38 cents per share, up 5.6%. The company has faced headwinds from soft consumer demand and portfolio changes, but its premiumization strategy and international expansion, particularly in emerging markets, are expected to provide some support. However, the Zacks model does not predict an earnings beat this time, as Brown-Forman has an Earnings ESP of -1.09% and a Zacks Rank of 4.

Pernod Ricard, the French distiller behind Jameson, Ballantine's, and Chivas Regal, warned that fading interest in alcohol in the U.S. will continue to weigh on sales over the coming years, offsetting growth in markets like India. The company reported sales of 9.4 billion euros ($11 billion) for the 12 months through June, down 14% from the prior fiscal year, or 3.9% lower on an organic basis. Sales were dragged by sharp falls in the U.S. and China, which together contribute around a quarter of group revenue. Pernod expects U.S. softness to keep group sales growth toward the lower end of its guided 3%-6% annual range through the next three years. In contrast, India, which makes up about 13% of group revenue, showed solid growth, and CEO Alexandre Ricard said a possible separate listing of the Indian business remains at "discussion level." The company also highlighted growth in ready-to-drink products, which rose 12% on year, as a recruitment opportunity among younger drinkers.

French spirits giant Pernod Ricard reported a 3.9% decline in organic sales for fiscal 2026, exceeding the market's expected 3.7% drop. Weakness in China and the US weighed on results, and the company now expects long-term revenue growth through 2029 to be at the lower end of its 3-6% range. Earlier this year, the company held talks with Brown-Forman, the maker of Jack Daniel's whiskey, about a potential merger, but the talks fell through due to disagreements over terms. CEO Alexandre Ricard said that in the US, its largest market, there is little prospect of growth over the next three years, and it will remain a drag on the group. Meanwhile, India has overtaken China to become its second-largest market, and the company has begun discussions and preparations for an initial public offering (IPO) there.

Kouzijiao released its 2026 semi-annual report, achieving operating revenue of 1.952 billion yuan, down 22.89% year on year; net profit attributable to shareholders of the listed company was 365 million yuan, down 48.97% year on year. The decline in performance was mainly due to a decrease in operating revenue during the reporting period, while the declines in administrative expenses and selling expenses were both smaller than the decline in operating revenue. Among them, net profit in the second quarter was 36 million yuan, and net profit in the first quarter was 329 million yuan, with second-quarter net profit down 89% quarter on quarter.

Yilite released its 2026 interim report. Total operating revenue was 726 million yuan, down 32.13% year-on-year. Net profit attributable to the parent company was 81.8629 million yuan, down 49.64% year-on-year. Net cash flow from operating activities was negative 283 million yuan, a decrease of 70.5745 million yuan compared with the same period last year. The company's asset-liability ratio was 30.28%, gross margin was 51.53%, ROE was 2.07%, and diluted earnings per share was 0.17 yuan. The number of shareholders was 54,700, and the top ten shareholders held 48.13% of the total share capital.