Davide Campari-Milano's delivery contributes to market appreciation
Campari, the Italian spirits company known for its iconic brands like Aperol and Campari Bitter, has announced its half-year results for 2025, revealing a resilient performance despite challenging global conditions.
The company reported an adjusted EBIT of €351.8 million, surpassing the consensus estimate of €332.5 million, with a slight year-over-year decrease of 2.3%. Campari's revenue grew to €1.53 billion, up 0.3% and above analyst estimates of €1.52 billion. The adjusted net profit of €216.2 million was around 10% lower than the previous year but significantly above the forecast of €193.5 million.
These reassuring results are attributed to effective cost-cutting strategies that helped navigate challenging conditions. Cost-saving efforts in production contributed to stability in the gross margin, while premiumization and mix effects, particularly higher contributions from margin-rich categories like Aperol, Campari Bitter, and Tequila, also supported the gross margin.
In a move to focus the portfolio on growth and margin-stronger brands, Campari announced the sale of the iconic Cinzano vermouth and the grappa brand Frattina for a total of 100 million euros. CEO Simon Hunt emphasized that there is no rush in the brand sales process.
The strategic outlook for Campari is influenced by the announced improvement in the EBIT margin. The company aims to organically gain up to 200 basis points in EBIT margin through targeted cost savings in distribution and administration over three years.
However, the impending trade risk, particularly U.S. tariffs on European spirits, could potentially impact Campari's EU products with €4 million to €45 million in 2025. Campari is not considering relocating production to the U.S. despite tariff discussions, and price increases in the U.S. are not considered a realistic option due to low consumer confidence.
The latest half-year results of Campari exceeded expectations in several areas, leading to an immediate rise in the stock price. As of early August 2025, the stock price showed volatility but a recent uptick (+7.95% on August 1, 2025), indicating some investor confidence post-results announcement.
Despite the positive results, the risk of tariffs remains a concern for Campari. Ongoing geopolitical uncertainties contribute to a cautious outlook, impacting global markets and consumer sentiment, which may affect premium beverage consumption trends.
Some analysts, including Deutsche Bank, have lowered price targets citing weak growth outlook despite good cost management. This suggests tempered expectations for near-term revenue growth. However, the company continues to pursue mergers, acquisitions, and pricing strategies to sustain competitive advantage and market share.
In summary, investment advice leans towards holding or selective buying, supported by efficient cost management and strategic initiatives, but tempered by geopolitical uncertainties and cautious analyst outlooks. Investors should monitor growth trends and external risks closely before increasing exposure.
For a comprehensive analysis of Campari's valuation, dividend strategy, broader market outlook, and investor recommendations, DER AKTIONÄR (32/2025) provides a detailed report, which can be downloaded from the provided link.
[1] Source: Financial Times [4] Source: Deutsche Bank Research
Campari's half-year results demonstrate a resilient performance in the face of challenging global conditions, with the company reporting a higher adjusted EBIT than expected and a slight decrease in revenue growth. This strong showing in finance has encouraged some investors to buy or hold Campari's stocks, seeing it as a good business opportunity due to effective cost-cutting strategies and strategic initiatives. However, the ongoing risk of tariffs and geopolitical uncertainties could impact consumer sentiment and premium beverage consumption trends, causing some analysts to lower their price targets and adopt a cautious outlook. Therefore, investors should closely monitor growth trends and external risks before increasing their exposure to this Italian spirits company. [1] [4]
