WG&S Korea, Importer of "Balvenie"
Sales Quadruple in Five Years, Surpassing 100 Billion KRW Last Year
Operating Margin Exceeds 40% for Two Consecutive Years
Beam Suntory Korea Leads Highball Craze
Sales Up 30% in Just One Year
In recent years, the domestic whiskey market, which had experienced rapid growth, faced a stagnation last year due to a correction phase. However, importers leading the single malt whiskey and highball trends with brands like 'Balvenie' and 'Gakubin' continued to show significant growth. The whiskey market is expected to remain polarized, with the liquor industry intensifying competition in star brand development and marketing this year.
According to the Financial Supervisory Service's electronic disclosure system on the 18th, William Grant & Sons Korea's sales last year reached 101.5 billion KRW, a 20.5% increase from the previous year (84.2 billion KRW). William Grant & Sons Korea is considered the biggest beneficiary of the whiskey boom that spread after the COVID-19 pandemic. Sales, which were 26.6 billion KRW in 2019 before the pandemic, more than doubled to 49.6 billion KRW in 2022, and last year surpassed 100 billion KRW for the first time in the company's history, nearly quadrupling in five years.
Operating profit also increased significantly. Last year's operating profit was 43.9 billion KRW, up 13.4% from 38.7 billion KRW the previous year. Profitability improved greatly as well. The operating margin, which was 20.1% in 2020, rose to 37.1% in 2022 and jumped to 46.0% in 2023. Last year, it maintained a high-profit business with a 43.3% margin for the second consecutive year. Considering the operating loss of 0.5 billion KRW in 2019, this is an explosive rebound.
Beam Suntory Korea also recorded sales exceeding 100 billion KRW for the first time. Last year, Beam Suntory Korea's sales were 101.2 billion KRW, a 27.1% increase from 79.6 billion KRW the previous year. Compared to 39.8 billion KRW in 2022, when it first started submitting audit reports, this represents a 154.3% increase over two years.
Operating profit was 9.1 billion KRW, down 31.1% from 13.2 billion KRW the previous year. However, it maintained relatively high profitability with an operating margin of 9.0%. The decrease in Beam Suntory Korea's operating profit was entirely due to increased selling and administrative expenses. Last year, these expenses rose by about 10 billion KRW to 44.6 billion KRW from 34.4 billion KRW the previous year, with advertising expenses accounting for most of the increase at 32.7 billion KRW, up 36.3% from 24.0 billion KRW.
Although both companies achieved strong results driven by whiskey, their strategies differ somewhat when looking at their portfolios. William Grant & Sons Korea, which owns representative brands such as single malt whiskeys 'Glenfiddich' and 'Balvenie' and blended whiskeys 'Grants' and 'Monkey Shoulder,' saw single malt whiskey as a key driver. Especially, Balvenie gained enthusiastic popularity among both beginners and enthusiasts during the pandemic, leading a whiskey open-run. Even as the whiskey boom somewhat subsided last year, it maintained a solid position, establishing itself as a steady seller beyond just a bestseller.
On the other hand, Beam Suntory Korea's strategy of selling cost-effective whiskeys in volume proved successful. Owning bourbon whiskeys like 'Jim Beam' and 'Maker's Mark' and Japanese blended whiskey 'Gakubin,' Beam Suntory Korea led the highball craze, boosting its performance. In addition to bottled whiskey, it expanded its product range and distribution channels by launching RTD (Ready to Drink) products such as 'Jim Beam Highball,' emphasizing authenticity. Recently, it also released 'Suntory Mini' for convenience stores, continuing its growth trend.
The strong performances of the two companies were achieved amid a sluggish whiskey market. The domestic whiskey market, which rapidly expanded through the COVID-19 pandemic, showed signs of contraction last year due to intensified competition from oversupply and consumption downturn caused by economic recession. According to customs import-export trade statistics, whiskey imports last year were 27,441 tons, a 10.3% decrease from 30,586 tons the previous year. Import value was 249.21 million USD (approximately 354 billion KRW), down 4.0% compared to 259.67 million USD in 2023.
Therefore, it is interpreted that both companies led performance growth by continuously maintaining the popularity of their signature products representing their categories in the market. A liquor industry insider said, "Balvenie and Gakubin are symbolic products of the recent whiskey boom," adding, "Polarization is occurring even within the same category, showing how important brand awareness and image are." He further noted, "As the domestic whiskey market is expected to continue gradual growth, internal competition is likely to become even fiercer."
In fact, Golden Blue, the number one domestic local whiskey brand, saw its total sales last year decrease by 6.5% to 209.4 billion KRW from 224.2 billion KRW the previous year. Operating profit also dropped 32.1% from 49.9 billion KRW to 33.9 billion KRW. Sales of its own-produced whiskeys, including the flagship 'Golden Blue Sapphire,' fell 11.0% to 176.2 billion KRW from 198.0 billion KRW, mirroring the overall performance. In contrast, imported whiskey sales such as 'Kavalan' increased by 80.0% to 15.6 billion KRW from 8.8 billion KRW the previous year.
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