Davide Campari-milano Spa Stock Earnings Reports

Campari delivered a solid 2025 despite a volatile operating environment. Organic net sales grew +2.4% (about +3% excluding Jamaica hurricane impact) with growth across 24 countries and gains in share in nearly every market. Gross margin improved by 100 bps (organic) and adjusted EBIT margin expanded by 60 bps (organic) as the company accelerated brand investment while progressing cost-containment measures (70 bps of SG&A benefit in 2025 toward a 200 bps target by end-2027). A&P was increased to 17.9% of sales as management prioritizes “fewer bigger bets” (Aperol is the champion). Cash generation was strong: recurring free cash flow conversion 73% (EUR 571m) and leverage fell to 2.5x a year ahead of plan. Extraordinary CapEx is nearing completion with a tail in 2026 (notably the Kentucky distillery); maintenance CapEx steady at ~4% of sales. Portfolio streamlining continues (disposals including Averna/Zedda Piras ~3% of sales), and Courvoisier (acquired Sept 2024) is being integrated with initial positive consumer traction. Management set midterm ambitions unchanged: on-track to mid- to high-single-digit top-line growth in a stable environment, with contained organic EBIT accretion in 2026 (skewed to H2 due to front-loaded A&P). Key financial guidance/assumptions for 2026: ~EUR 30m tariff impact (vs EUR 11m in 2025), continued SG&A savings (~70 bps in 2026), a modest increase in brand investment, leverage to remain at sustainable levels, and a higher dividend (DPS raised from EUR 0.065 to EUR 0.10; payout ~35%). Main investor risks/monitoring items: macro/geopolitical volatility (including recent Middle East developments), U.S. tariffs and pricing environment, retailer dynamics in Germany, and finalization of the remaining extraordinary CapEx.