Gruppo Campari, the parent company of J Wray & Nephew Limited, said it is expecting the shortage of its white overproof rum to be alleviated earlier than previously anticipated, with the shortage now expected to be over from as soon as December, instead of early next year, as was previously communicated.

The company’s Wray & Nephew white overproof rum and its Charley’s JB white overproof rum have been in short supply since earlier this year with production hampered by environmental restrictions on how it stores and uses dunder, the waste product from rum production, and its decision to prioritise its premium Appleton Estate brand aged rums which it positions chiefly for the export market.

The situation has caused some retailers to cap the number of bottles of white overproof rum any one consumer can purchase at a time, while complaints have also emerged about some retailers taking advantage of the situation to hike prices.

“On the first one, clearly, the hurricane disruption has impacted our ability not only to distil but also to bottle physically. We will fix it by December, so we still are expecting Q4 to be negative in Jamaica. And the shortfall of supply will still impact international markets, namely the U.K. and the U.S., the two biggest ones,” said Paolo Marchesini, Campari’s chief financial officer, chief operating officer and interim co-CEO, while giving an update on the situation during the company’s recently held earnings call.

Marchesini also added, “The other one, the issue of ability to distil at full steam, that depends on the investment, the green project of dunder treatment, so waste management treatment. This project, the second one, will be completed in the first part of next year, as planned. That would unlock the possibility for us to distil at full steam. So, this is how we see the Jamaican issue being solved between, say, December this year on general operations, and on distilling for full steam, a little bit more down the road.”

Marchesini was appointed interim co-CEO of the Campari Group alongside Fabio Di Fede on September 18 when Matteo Fantacchiotti resigned as CEO and a director of the company’s board.

J Wray & Nephew has invested US$65 million ($10.2 billion) into a treatment plant at its New Yarmouth distillery in Clarendon. The improved capacity to treat the dunder waste by-product would allow for the company to continue producing rum and not shut down the distillery, as seen earlier this year when its ponds became full. The recent rainfall would have affected the company’s ability to dilute the dunder with water and use it as a fertigator to its planted sugarcane.

Campari’s Jamaican operations saw third-quarter (July to September) revenue contract by an estimated 20 to 22 per cent from €33.9 million ($5.65 billion) in Q3 2023, which was also affected by supply constraints, to €26.5 million ($4.50 billion). The estimated revenue for Q3 2022 was €42.2 million ($6.90 billion).

J Wray & Nephew’s fourth quarter will be negatively impacted by the tail-end impact of Hurricane Beryl.

For the overall nine-month period, sales were down 0.8 per cent to €105.5 million ($17.90 billion). If the impact of Hurricane Beryl was not present, Jamaica’s consolidated net sales would have been flat or relatively unchanged from the prior year. Jamaica represented 4.6 per cent of Campari Group’s net revenue.

Jamaica generated €182.5 million ($31.14 billion) in revenue during 2023 and €178.7 million in revenue during 2022 where it earned €60.3 million ($9.78 billion) in profit before taxation. The 2023 profitability will be disclosed in the company’s 2024 annual report to be published in Q1 2025. The Jamaican rums portfolio has been up 10 per cent annually since 2019.

“The performance of Jamaica in the third quarter of the year was affected by the hurricane in July, leading to product availability constraints and softer operating environment. The cumulative sales performance of the first nine months of 2024 was supported by price increases in both rums and Campari, thus offsetting impact on volumes,” said Campari’s Q3 report.

Some of the other products in the Jamaican company’s portfolio include Magnum Tonic Wine, Campari’s aperitif portfolio and the Courvoisier cognac which it started distributing on November 1. The Campari Group completed the acquisition of Courvoisier Holding France S.A.S. (formerly Beam Holdings France S.A.S.) on April 30 for US$1.17 billion or €1.08 billion with the overall enterprise value of the deal being US$1.20 billion.

Campari’s consolidated net revenue marginally improved for the third quarter to €753.6 million but saw its operating profit contract 10 per cent from €147.4 million to €132.9 million. The group’s profit before tax dipped 20 per cent to €106.5 million.

The overall nine months saw consolidated net revenue rise three per cent to €2.28 billion with operating profit decreasing five per cent from €491.1 million to €468.5 million. Profit before tax was down six per cent from €444.3 million to €417.2 million. Macroeconomic weakness, poor weather and pressure on disposable income due to inflation and reduced market confidence were some of the factors blamed for the reduced earnings for the nine-month period.

Campari’s stock price closed Thursday on the Italian Stock Exchange at €5.69 which leaves it down 44 per cent year to date with a market capitalisation of €6.87 billion. Campari launched a new €40 million share buyback programme on October 30 and expects to appoint a new CEO by the first half of 2025.

As part of its 2025 outlook, the Campari Group will be initiating a cost containment programme, streamlining its portfolio by disposing of non-core brands and building on its house of brands including Cognac & Champagne, Aperitifs, Whiskey, Rum and Tequila which will include stronger marketing effectiveness via stronger central coordination leveraging existing local marketing capabilities.