Franklin Liquors
Wednesday April 24th 2013
Heineken Flags Moderating Growth as Quarterly Volume Falls
Source: Bloomberg
By Clementine Fletcher
Apr 24, 2013
Heineken NV (HEIA), the world’s third- biggest brewer, reined back its expectations for annual growth after reporting an unexpected decline in first-quarter sales, sending the shares down the most in 20 months.
So-called organic volume and revenue will improve this year at a slower pace than the company had anticipated as tough conditions in austerity-hit markets in Europe as well as a slowdown in Nigerian sales hold back purchases, Heineken said today. The brewer hadn’t previously given a specific forecast.
Heineken fell as much as 6 percent in Amsterdam trading, the steepest intraday decline since Aug. 24, 2011. In addition to sliding sales in western Europe, the brewer also reported lower volume in the central and eastern part of the continent, Asia Pacific and the Americas (HEIA).
“It was always going to be a tough quarter, but it seems to have been even worse than feared,” Jonathan Fyfe, an analyst at Mirabaud Securities in London, wrote in a note to clients today. “We expect to lower our forecasts.”
The shares dropped 5.6 percent to 54.47 euros as of 9:54 a.m. in Amsterdam, trimming this year’s gain to 8.3 percent.
Consolidated lager volume, excluding the effect of acquisitions, dropped 4.7 percent, the brewer said, missing the median estimate of 12 analysts for a 0.6 percent increase. Revenue excluding currency swings and acquisitions dropped 2.7 percent compared with a median estimate for a 2 percent rise.
Russian Tax
Heineken, which gets the largest portion of its revenue from western Europe, posted an 8.8 percent decline in beer volume in the region. Central and Eastern European volume dropped 3.7 percent as Russian beer tax increases and regulation to stop sales of the drink in freestanding kiosks cut demand.
Heineken is trying to offset stagnant developed markets with sales in faster-growing economies. It bought out its joint- venture partner’s stake in Asia Pacific Breweries for S$5.6 billion ($4.5 billion) last year to gain greater control over south-east Asian markets including Vietnam. The APB integration is “progressing well,” Heineken said.
Consolidated beer volume in Asia Pacific fell 1.4 percent. Volume in the Americas (HEIA) also fell as Mexican demand waned due to bad weather and the Brazilian beer market declined. The volume of the eponymous Heineken brand fell by 4.7 percent on an organic basis.
Unfavorable currency movements reduced revenue by 34 million euros, or 0.9 percent, the company said.
Earnings before interest and taxation slid at a pace in “mid single-digits,” excluding some items and the effect of acquisitions and currency fluctuations, Heineken said.
Accounting Change
“Global market conditions remain volatile, contributing to a weaker-than-expected first quarter,” the brewer said. “Challenging trading conditions in austerity affected markets in Europe and inflationary pressures in Nigeria are expected to continue to impact volume development for the balance of the year, leading to a moderation in organic growth expectations.”
Results for the year will also be affected by a charge related to a change of accounting standards, reducing adjusted net profit by 75 million euros, the company said. Analysts had expected annual profit on that basis of 1.86 billion euros.
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Heineken
Source: Nomura
Apr 24th
Neutral, PT Eur 60, Lord Shackleton
Q1 Topline miss, talking down FY growth rates – expect weakness in stock. Consensus looks set to be hit by about 6%. Most of this is the IAS 19 pension impact (4%) with the rest from moderating growth in the core business. Stock should be down by as much but am always nervous given high short base. Q1 organic consolidated beer volumes -4.7% vs Nomura -2.0% and consensus +0.6%. Organic revenues -2.7% vs Nomura +0.5% and cons +2.0%.
Big miss in Africa and Middle East (-4.6% vs est flat) and Western Europe (-8.8% vs est -5.0%) with misses in Americas (-2.4% vs. est +2.0%), Asia Pacific (-1.4% vs est 2.0%). CE Europe was better -3.7% vs. -5.0%. Organic EBIT declined mid-single digit. Company indicates a moderation of growth rates for the FY, mentioning Europe and Africa.
Company flagging 2013 hit from IAS 19 of Eu0.13 at EPS (4%). Street consensus currently EUR 3.25 for 2013 (NE 3.20) -with the IAS19 adjustment and shaving of FY estimates for slower growth, we would expect street EPS to move down to Eu3.05 or lower
The shares have seen a strong re-rating since the Asia-Pacific Breweries (APB) deal at the end of last year, which has substantially closed the gap with the average sector rating (Heineken 2014 P/E 16.3 v sector 17.1x).
Read-across:
Carlsberg – Q1 due 7 May – mixed – Russia down mid-single digits. We estimate Carlsberg E Europe -5% in Q1 which looks ok . W.Europe weak for Heineken ; we estimate Carlsberg -5%, which will be less negative due to Scandinavia
ABI – Q1 due 30 April – negative – Heineken indicating Brazil down mid-single digits in-line with market. We estimate Q1 Latam North volumes -2%
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US Spirits – “March NABCA data looks light”
Source: UBS
Apr 23rd
March data appears soft due to technical effects
On an unadjusted basis, March volume declined by -2.7% and sales were up +0.5%. NABCA data (covering 22% of US spirits volumes) released for March looks light, but was impacted by several technical effects: five calendar Sundays in March 2013 vs. four last year (Sunday sales prohibited in 6 Control States), timing of Easter, and the fact that Michigan (16% of NABCA vols) reported 4 weeks of sales vs. 5 weeks of sales in March 2012. March adjusted volume growth is +2.9% and sales +6.4%, implying price/mix +3.5% y/y. 12 month rolling trends are vols +3.4% and value growth +6.4%, with price/mix +3.0%.
Diageo lost volume share, but price/mix remains higher vs. market
Diageo unadjusted Dec volumes declined -8.4% y/y, continuing to lose volume share (LTM -0.6% y/y). However, according to Nielsen data, Diageo has higher price/mix growth than the rest of the market, partly affecting its volume growth. Pernod Dec volumes fell -2.8% (LTM +1.1%) in line with the market.
Constellation, Remy, Campari gained volume share in March
Brown-Forman unadjusted March volumes fell -3.7% y/y (LTM +2.3% y/y), below the market growth rate. Moet Hennessy underperformed with -5.1% volume growth y/y in Mar (LTM +9.0% y/y). Remy’s March volumes were down -1.2 % y/y (LTM 10.5%) implying some share gain relative to the market down -2.7%. Campari’s March volumes grew by 6.1% y/y (LTM +3.9% y/y).
Buy ratings for Pernod, Constellation Brands and Brown-Forman.
We estimate 2013 US spirits volume and value growth of +2.0% and +4.5% y/y.
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Maker’s Mark’s Samuels took lesson from New Coke
Source: Business First
Kevin Eigelbach
Apr 23rd
Bill Samuels Jr., the chairman emeritus of Maker’s Mark Distillery Inc., said he took a lesson from The Coca-Cola Co.’s New Coke fiasco during the 1980s when his company contemplated changing its product earlier this year.
Speaking at a meeting of the Louisville chapter of Financial Executives International today at the Hurstbourne Country Club, Samuels said that when Coca-Cola was taking flak for introducing New Coke in 1985, Maker’s Mark took out newspaper ads defending Coca-Cola. The chairman of Coca-Cola at the time was so impressed that he flew Samuels to Coca-Cola headquarters in Atlanta to have lunch with him.
They met for about two hours, with the Coca-Cola chairman speaking for about one hour and 59 minutes of the time, Samuels said. It gave Samuels a two-hour lesson in what to do if anything like that would ever happen to Maker’s Mark, he said.
As Business First previously reported, something like that did happen in February, when Makers’ Mark announced that it would water down its product to help meet demand. After enduring a barrage of complaints from customers, the company soon reversed course – much more quickly than Coca-Cola reversed course on New Coke.
As I recall, that product lingered on store shelves for several years, with Coca-Cola bringing back the original formula as Classic Coke. Now, it’s all the original formula again.
Anyway, Samuels said Maker’s Mark – which is owned by Deerfield, Ill.-based Beam Inc. (NYSE: BEAM) – received 140,000 e-mail responses to the plan to water down the product, all of them saying “don’t mess with my whiskey.” It wasn’t hard to figure out what to do after that, he said.
To keep American customers supplied, the company has had to cut back on its international sales, Samuels said. But that’s OK, he said, because the company believes in serving its current customers first.
The incident very well could have destroyed all the goodwill that Maker’s Mark has built up with its customers in the past 50 years, he said. The company has had 33 straight years of double-digit growth and now has assets of just less than $3 billion.
Since he retired as president of Maker’s Mark in 2011, one of Samuels’ roles has been to make sure the company follows the principles laid down by the company’s founder, his father, Bill Samuels Sr. He said he feels he has done a pretty good job of that, except for the initial decision to water down the product.
One of those principles is to always exceed expectations, he said, which makes your product one that others will discover and talk about. That’s good advice for anyone who provides a product or service, he said.
“You may own the product, but the consumer owns the brand.”
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Lead abatement, alcohol taxes and 10 other ways to reduce the crime rate without annoying the NRA (Response)
Source: Washington Post
Ray Scalettar
Apr 23rd
Unfortunately, Mr. Matthews chose to cite advocacy research when it comes to the impact of higher alcohol taxes. Repeated studies, including research by the National Institute on Alcohol Abuse and Alcoholism, have shown that alcohol abusers are not deterred by higher prices. It is the moderate, responsible consumers who are most sensitive to prices and are the ones that cut back the most when prices increase.
In fact, in 2011 the CDC itself cited moderate alcohol consumption as one of four healthy lifestyle behaviors that help people live longer. This is supported by the Federal Dietary Guidelines and the scientific literature, which conclude that moderate consumption of alcohol– distilled spirits, beer or wine– is associated with the reduction of cardiovascular disease as well as all-cause mortality. As the American Heart Association points out, cardiovascular disease is the number one cause of death in the United States. To the extent price increases unduly affect moderate drinking patterns of responsible adults, these important health benefits could be lost.
Advocates of price increases also fail to account for the enormous economic impact the blunt instrument of higher taxes would have. Not only would it hurt the vast majority of responsible, moderate consumers, but also thousands of entry level men and women employed by the small businesses in the hospitality industry located in every town and city in America.
Raymond Scalettar, M.D., D.Sc.
Clinical Professor of Medicine, George Washington University Medical Center
Former Chair of the American Medical Association, Medical advisor to the Distilled Spirits Council
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Mexico asks for “justification” over high-alcohol Tequila ban (Excerpt)
Source: Just-Drinks
By James Wilmore
23 April 2013
The Mexican Government has asked China to give “scientific justification” for its long-running restriction on high-alcohol Tequilas in the country.
Mexico’s authorities have been in talks with China since 2009 over its ban on distilled spirits containing more than two grams of methanol per litre. The measure prevents premium Tequilas being sold in China, whereas other Tequilas have access to the market.
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Washington: Some big name retailers caught selling liquor to minors
Source: KING 5 News
by CHRIS INGALLS
April 23, 2013
Some of the biggest retail food and drug stores in the Puget Sound region top a list of offenders when it comes to the sale of hard liquor to minors.
The KING 5 Investigators obtained data compiled by the Washington State Liquor Control Board (LCB) since a new law went into effect last June that privatized liquor sales in the state.
The records show that undercover “stings” by LCB resulted in nine citations issued to Safeway stores for the sale of liquor to a minor. Most of those are stores in Western Washington.
Following Safeway are Fred Meyer stores, with 7 citations; Walgreens, 6 citations; Rite Aid, 5 citations; QFC, Albertsons and Walmart, 4 citations each; Costco, Bartell and Trader Joe’s, 2 citations each.
The companies topping the list — Safeway and Fred Meyer — said they take the violations seriously and they discipline or fire employees who violate their strict policies for the sale of booze.
Safeway also pointed out that with 160 stores across the state it is now Washington’s largest liquor retailer, meaning its sheer size can explain why it had more infractions than other retailers.
In all, 82 citations have been issued to “spirits retailers” across Washington since the new law took effect last June.
Undercover stings
Voter approved Initiative 1183 spelled the end of state-run liquor stores, handing the reins over to private companies. Hard liquor is now sold in hundreds of larger stores across the Washington.
The LCB says it hopes to conduct compliance checks at each one of those retailers before the one-year anniversary of the new law.
“I think people were concerned because it’s a new thing and we don’t have the control system like we used to,” said LCB Sgt. Lorn Richey during a sting operation earlier this month.
Richey and another officer watched as a trained high school student entered several stores that sell hard liquor. When she attempted to buy a bottle, clerks in each store turned her down.
“It went great. Everybody was complying with the law. That’s what we want to see,” said Richey.
Stores that sell to the undercover teen could pay a steep price. Under the new law, the fine for a first time offense is $1,000.
But the KING 5 Investigators found many retailers found to have sold liquor to minors aren’t paying that amount, thanks to the LCB’s Responsible Vendor Program. Retailers that participate in the program provide extra training to employees and adhere to the strictes alcohol sales policies.
“Since everybody’s got additional training the likelihood that they’re going to fail a compliance check is a lot lower if they follow those best practices,” said Sgt. Richey, explaining the program’s goal of helping retailers follow the law..
However, records reviewed by KING 5 show that 25 percent of the spirits retailers cited since June 2012 are enrolled in the responsible vendor program.
The law allows them to pay a reduced fine for their first offense of just $500.
The fact that so many enrollees in the responsible vendor program ended up being ticketed appeared to surprise officials at LCB. However, they cautioned that they will need more data before reaching any conclusions about which parts of the new law might not be working.
LCB officials say that compliance checks at spirits retailers show that 93 percent of them are following the law and denying sales to minors. That’s about the same compliance rate that liquor stores had when they were run by the state.
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Wine industry must grapple with big health care, tax, estate changes
Source: North Bay Business Journal
By Gary Quackenbush
Apr 22nd
Business owners, particularly the wine industry that makes up a significant proportion of the North Coast economy, need to pay attention to major health care insurance, tax and estate law changes this year to avoid steep noncompliance penalties and mitigate significant tax increases, according to local tax-planning and insurance experts.
Mike Parr, employee benefits broker with Northwest Insurance agency, a subsidiary of George Petersen Insurance, focused on how business owners should prepare for health care reform at a recent roundtable on wine industrial financial issues hosted by accounting firm Moss Adams LLP.
“There are positive aspects of the new health care reform bill at a time when insurance costs are increasing 10 to 20 percent annually,” said Mr. Parr.
Since March 2012, all preventative care is covered by all carriers and plans under the federal Affordable Care Act. Children are also covered up to age 26, and insurers cannot decline coverage for children with pre-existing conditions for individual coverage. Furthermore, lifetime maximums on health insurance plans have been eliminated.
A small-business tax credit covers eligible employers with 25 or fewer full-time equivalent (FTE) employees whose annual wages are less than $50,000. This tax credit equals 35 percent of an employee’s annual premiums the employer has paid for in years prior to 2014. It will increase to 50 percent after 2014.
Employers must provide employees with a summary of benefits and coverage (SBC), available from a broker or health insurance carrier. This document must include relevant data, including out-of-pocket costs, deductibles, limitations, referrals, etc., with definitions and examples, along with a standard form to help participants understand and compare plan options, according to Mr. Parr.
The penalty for not providing the summary is $100 per day for each affected employee.
Covered California is the name of the online health insurance exchange (coveredca.com) where small business employers with two to 50 workers can purchase group health insurance. Individual health plans are also available, along with access to a Federal Subsidy Assistance calculator.”
The exchange is scheduled to go live on Oct. 1 for health insurance plans with a Jan. 1, 2014, or later effective date. The exchange website already is live and has background information.
Employers are also required to provide employees with a notice of insurance exchange (NIE). The deadline for issuing these notices was originally set for this March, but has been delayed by state and federal courts. A new date has not been established.
An employer mandate to provide health care insurance applies to large businesses with 50 or more full-time-equivalent (FTE) employees, each working 30 or more hours per week, or 130 hours per month.
This mandate does not include designated seasonal employees working less than 120 days during the year. Leased employees also are not included. If a business is a large employer, seasonal employees working in excess of 30 hours a week are eligible for the penalty calculation.
The employer mandate comes with a series of penalties for non-compliance, such as when coverage is not offered and one employee obtains a subsidy in the exchange, triggering a state or federal audit and fines.
Will large employers keep their health care plans? Research suggests that most will, according to the experts at the roundtable.
“Top reasons for keeping their plans include retaining current employees, the ability to attract future talent and also in order to maintain employee satisfaction and loyalty,” Mr. Parr said. “This doesn’t mean that employers won’t compare the cost of offering health insurance to costs associated with paying penalties.”
Big changes to tax law in 2013
An overview of tax law changes was provided by Michael Ricioli, CPA, tax partner with Moss Adams LLP.
“As taxpayers prepared for the fiscal cliff at the close of the 2012 tax year, emphasis was placed on accelerating income, rather than escalating deductions, in an effort to take advantage of lower tax rates in 2012,” Mr. Ricioli said.
The federal top income tax rate increased from 35 percent in 2012 for ordinary income to 43.4 percent in 2013, including a new 3.8 percent surtax on net investment income.
Rates on long-term capital gains and qualified dividends rose from 15 percent in 2012 to 23.8 percent this year, also including the 3.8 percent surtax.
The new 3.8 percent net investment income surtax for Medicare is payable by individuals, trusts and estates on the lesser of net investment income, or excess modified adjusted gross income, over $200,000 for singles, $250,000 for married couples filing jointly and $11,950 for trusts and estates.
A 0.9 percent increase in the employee portion of Medicare Hospital Insurance (HI) FICA tax on wages is in effect for wages exceeding $200,000 for singles or $250,000 for jointly filing married couples in a calendar year. There was no change to the employer portion.
‘Sweet spot’ for S-corp.
Taxpayers can be hit with both Medicare and hospital insurance tax increases, and there will be more focus on lesser-involved owners to document their active participation in the business, according to Mr. Ricioli.
“A sweet spot exists for active S-corporation business owners who are paid reasonable wages,” he said. “These owners may be able to avoid both the 3.8 percent Medicare and the 0.9 percent HI taxes.”
Winery owners who do not have this structure, will likely start taking a closer look at S-corporations to minimize their tax liabilities, he said.
A business must have taxable income to take advantage of the accelerated-depreciation provisions under Internal Revenue Code Section 179. Amounts expensed under this section are excluded from uniform capitalization, or UNICAP. Therefore, these deductions are not required to be capitalized into bulk or cased goods inventory.
The expense limitation for the 2013 tax year is $500,000 and this benefit begins to phase out once eligible asset additions exceed $2,000,000.
The 50 percent bonus depreciation provision has been extended through 2013 and applies to new assets only. It includes qualified leasehold improvements (excluding related party leases) and will not cause an AMT adjustment, but it is subject to UNICAP.
In California, net operating losses are now available for use in the 2012 tax year. A single sales factor for apportionment calculations will be mandatory in 2013 under Proposition 39.
The state’s top individual income tax rate is now 13.3 percent under Proposition 30, and a sales-tax increase of 0.25 percentage points is also in effect due to Prop. 30.
A key item that applies to vineyard and winery owners is an analysis of the purchase-price allocation as it relates to the purchase and sale of a vineyard or winery.
“Various exemptions and provisions are sometimes overlooked pertaining to a sale, and it is important to understand what are the related tax implications of assigning different values to the assets being purchased to both the buyer and the seller,” he said.
Tools for growers, exporters
With the increase in tax rates in 2013, vineyard owners have an opportunity to take advantage of farm income averaging. This is another commonly overlooked provision that can provide vineyard owners with some significant tax benefits in upcoming tax years.
As wineries continue to increase global sales, tax planning has increased around international transactions. Although tax rates have gone up, wineries with international sales are still taking advantage of the use of an Interest Charge-Domestic International Sales Corporation (IC-DISC).
If structured correctly, this allows a winery to have a portion of its income that would otherwise have been taxed at their ordinary tax rate, converted to a qualified dividend that is taxed at the current maximum rate of 23.8 percent. This tax rate arbitrage can provide significant tax savings for wineries, given the right circumstances.
Cost-shifting eases tax impact
Despite all the estate planning done in 2012, such a review for this year will continue to be relevant due to relatively low valuations, higher exemptions, the possible elimination of valuation discounts, and limitations of leveraging techniques – like grantor trusts such as grantor retained annuity trusts (GRATs), according to Jay Silverstein, J.D., LLM, a Moss Adams principal.
“In 2012, planning was based on the assumption that the $5.12 million exemption would be reduced, when, in fact, it was increased,” he said. “Because of the higher exemptions, more emphasis will be placed on making ownership transitions that preserve and protect business assets and shift income to adult children who are in lower tax brackets.”
Estate, gift and generation-skipping tax (GST) rates all went up to 40 percent this year from 35 percent last year. However, the exemption for all categories increased from $5.12 million to $5.24 million per person, or to $10.48 million for a married couple.
Owners of large wineries, those with a net worth in excess of $10 million, can take advantage of valuation discounts and GRAT benefits and grantor trusts to transfer significant wealth free of estate and gift tax, according to Mr. Silverstein.
“With increased income tax rates and estate and gift exemptions, winery owners will have to weigh estate and income tax benefits of current gifting with the loss of basis step up on assets held until death,” he said.
“Higher income tax rates and the new 3.8 percent Medicare tax, have made shifting income more important,” Mr. Silverstein said. “However, we should let the tax tail wag the dog by gifting assets to the next generation to minimize estate and income taxes, but not create an ownership structure that fails to preserve the value of the winery because of family conflicts.”
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RABOBANK REPORT: GLOBAL WINE INDUSTRY Q1 2013 – IMPACT OF TIGHT WINE INVENTORIES MAINLY LIMITED TO EUROPE
Source: Rabobank
April 23, 2013
Rabobank has published a new report on the global wine industry, looking at issues of supply, demand and pricing in key markets around the world.
In the report, Rabobank’s Food & Agribusiness Research and Advisory group says that the impact of tighter global wine inventories has mainly been felt in Europe and in the lowest price segments to date. Although bulk wine shipping has helped to globalize the world wine trade, the impact of tighter supply has been felt very differently across producer regions.
Stephen Rannekleiv, Rabobank wine industry analyst, commented, “With rising prices and tighter inventories in Europe, a key question for the industry is whether the traditional buyers of European bulk wine – such as other EU countries, Russia and China – will accept higher prices, move to seek lower quality sources of supply, or simply reduce bulk wine purchases because consumers will not accept higher prices for wine.”
Russian bulk wine buyers have been adjusting sourcing as European bulk prices have risen, but have yet to purchase significant quantities of higher priced New World bulk wine. Price premiums have also kept other highly price-sensitive bulk wine buyers from bidding more aggressively on New World supplies.
“As the year progresses, it will be important to watch how these price-sensitive markets react and whether consumers will accept higher prices or switch from wine to spirits and/or beer,” added Rannekleiv.
The Northern Hemisphere harvest of 2012 was mixed, with production increasing more than 20% in the U.S. and declining 10% in Europe. The price of bulk wine in France and Spain rose significantly towards the end of 2012, as it became clear that inventories had tightened and the coming harvest would be light. South African bulk wine prices remained stable in the domestic market, but the weakening of the Rand lowered the cost for foreign buyers seeking alternative sourcing.
Somewhat surprisingly, the tightening supply situation has not yet caused Chilean bulk prices to rise. This likely reflects a combination of factors, such as its higher average price, the expectation of a large harvest in April, and the fact that Chile’s largest buyer (the U.S.) just had its largest harvest on record.
The wine industry’s attention now turns to the 2013 Southern Hemisphere harvest, which is currently underway. Preliminary expectations are for a larger Southern Hemisphere wine harvest in 2013, with the potential to lower bulk wine prices from those regions.
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The Wine Advocate & eRobertParker.com Unveil Two More Reviewers Joining Its World-Renowned Editorial Team
Award-Winning Critics to Cover Italy, Spain, Argentina and Chile
Source: NBC News
4/23/2013
The Wine Advocate and eRobertParker.com, the most trusted authority in wine reviews, couldn’t be more thrilled to introduce the two newest members of its world-renowned review team: Monica Larner, who will focus on Italian wine, and Luis Gutiérrez, who will take on Spain, Argentina and Chile.
“We’re excited about the new team and assignments,” said founder and chairman, Robert M. Parker, Jr. “Monica is one of the most comprehensive writers of Italian wines out there. Having the advantage of devoting herself full-time to this important region and living within its culture is phenomenal. And Luis is known as the foremost expert in Spanish wine today. From his home base in Spain, he’ll be putting his Spanish-speaking skills to great use as he reviews wine from Spain, as well as Chile and Argentina.
Larner was most recently the first Italian editor for Wine Enthusiast, establishing and running the tasting bureau for 10 years. She utilized the 100-point scoring system, reviewed 3,000 wines per year (a total of 16,000 published reviews overall) and produced a 185-page special collector’s Wine Enthusiast Wines of Italy edition showcasing her decade-long body of work. She was awarded the top prize for journalism by the Comitato Grandi Cru d’Italia three times — more than any individual. Before that, Larner spent years reporting for BusinessWeek in Rome, Italy Daily of International Herald Tribune and La Repubblica before her stint as a freelance writer. She is an active member of the Ordine dei Giornalisti, a certified sommelier with the Italian Sommelier Association, and has written four guidebooks about Italy, including a photographic archive of 50,000 images. Larner is an American who has lived in Italy off and on since she was 11 years old — attending high school in both California and Italy. She grew up in a family that celebrated everything about wine culture, developing a deep appreciation and love of wine from an early age. She earned a bachelor’s degree in journalism from Boston University and a master’s in journalism from New York University. She currently resides in Rome.
A native of Spain, Gutiérrez most recently split his time between being an IT professional for more than two decades, a Spanish correspondent for JancisRobinson.com, and a founding member of elmundovino.com, the most prestigious wine Web site published in Spanish. He received the Spanish National Gastronomy Award for journalism in 2012. In addition, Gutiérrez wrote for publications belonging to El Mundo newspapers in Spain, as well as contributed to various wine and gastronomy publications in Spain, Portugal, Puerto Rico and the United Kingdom. He primarily covered wines from Portugal and Douro Valley, Spain and wrote about wines from Burgundy, Rhone, Germany, Champagne and other classic European regions. He also contributed to the Spanish wine coverage in 1001 Wines You Must Taste Before You Die and co-authored the award-winning book, The Finest Wines of Rioja and Northwest Spain (2001) in the United Kingdom, United States and Japan. He lives in Madrid with his wife and three children.
About The Wine Advocate and eRobertParker.com
For more than 30 years, The Wine Advocate and eRobertParker.com have been the independent consumer’s guide to fine wine. Both were created by world-famous Robert M. Parker, Jr., the only critic in any field to receive the highest Presidential honor from three countries — France, Italy and Spain. The guides provide a wealth of information to its subscribers, including a searchable database of more than 220,000 professional wine ratings and reviews, plus articles, videos, daily news content, online retail availability and pricing, and an active professionally moderated bulletin board. For more information, visit www.erobertparker.com.
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Port 2011 hailed ‘classic’ as producers rush to declare
Source: Decanter
by Richard Woodard
Tuesday 23 April 2013
The 2011 Port vintage is set to become the first widely declared year since 2007, with the wines hailed as ‘classics’, with a character ‘rarely seen in the Douro Valley’.
taylors
Several producers have moved to declare 2011 in the past few weeks, two years after 2009 was declared by some producers – notably Taylor, Fonseca and Croft – but not by others, including the Symington quartet of Dow, Graham, Warre and Cockburn.
‘From the beginning I think we knew we were in the presence of a great vintage,’ said Luis Sottomayor, winemaker for Sogrape-owned Sandeman, Ferreira and Offley.
‘I have been working in the Douro Valley for more than 23 years, I have made a lot of vintage Port and I have never seen a wine with so much concentration, power and these tannins.
‘It’s a typical, classic vintage . We have the same acidity as in 2007 but a much stronger and more robust wine.’
Taylor, Fonseca and Croft owner The Fladgate Partnership declared 2011 today, St George’s Day, as is the company’s custom, with winemaker David Guimaraens highlighting ‘wines that have elegance as well as depth and stamina’.
He added: ‘The 2011s stand out for the purity of the fruit and the quality of the tannins, which are silky and well integrated, but provide plenty of structure.’
As well as Taylor, Fonseca and Croft, Fladgate also declared Vargellas Vinha Velha, made from selected old vines on the Quinta de Vargellas estate.
The Symingtons – who declared Graham, Dow, Warre and Cockburn – said strong winter rains in late 2010 had played a ‘crucial’ role, resulting in wines with ‘an exceptional depth of colour and concentration, rarely seen in the Douro and with marked minerality from the schistous Douro soil’.
The company has also made two single vineyard wines from the 2011 vintage – Graham’s The Stone Terraces (from selected plots at Quinta dos Malvedos) and Capela do Quinta do Vesuvio, which was launched with the 2007 vintage.
Meanwhile, Fladgate CEO Adrian Bridge said the company would be selling double magnums and imperials of the 2011s in response to growing demand for larger formats.
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DEEP EDDY NAMES INDUSTRY VETERAN ERIC DOPKINS CHIEF EXECUTIVE OFFICER FOUNDER CLAYTON CHRISTOPHER TO BECOME EXECUTIVE CHAIRMAN AND CHIEF INNOVATION AND MARKETING OFFICER
Source: Giant Noise
April 23, 2013
Deep Eddy co-founder and CEO Clayton Christopher announced today that he and co-founder Chad Auler have named Eric Dopkins the new chief executive officer of the all-natural craft vodka company based in Austin, Texas. Christopher will transition from CEO and become executive chairman and chief innovation and marketing officer. The appointment of Dopkins, a veteran in the spirits industry with over 20 years of leadership experience, signals Deep Eddy’s commitment to continued expansion and the goal of becoming a national leading vodka brand.
“I’ve had a lot of reasons to celebrate over the past few years since we launched Deep Eddy Vodka, but this is definitely one of the most epic milestones since we started,” says Christopher. “It’s exciting when the brand has become much bigger than “you,” and Deep Eddy is not only at that place now, but also got there much faster than we ever imagined. Eric is one of the top spirits executives in the industry. He has the skill, experience and passion needed to help make Deep Eddy a national player in our space. This move will position Deep Eddy for strong, sustained growth for many years to come. Eric shares the competitive drive and a passion for high quality, all natural spirits and mission driven values that Deep Eddy is all about.”
“The spirits business is dynamic and tomorrow’s category leaders are often not the big brands of today. Consumers are changing, and Deep Eddy Vodka has the potential of becoming a category-leading brand,” says Dopkins. “Developed by a talented and innovative team, Clayton Christopher and Chad Auler have crafted a premium, all-natural lifestyle brand that is truly American and truly Austin. The long-term potential of Deep Eddy excites me, and I look forward to working with a quality team of talented individuals.”
Dopkins most recently served as president of Young’s Market Company California, a California-based beverage distributor with annual revenue of $1.55 billion. Previously, he served as V.P. general manager of west U.S. for Pernod Ricard, USA, where he led sales, marketing and finance with sales revenue of approximately $300 million. Dopkins also served as president for Boz Spirits, Inc., Diageo general manager & V.P. of western region for Diageo North America and district manager for Canandaigua Wine Company. Dopkins received his B.S. in Business Administration (Marketing) from C.S.U. Chico.
For information Deep Eddy, please visit www.deepeddyvodka.com.
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Brinker: March sales drove 3Q profit
Sales turned around at Chili’s, Maggiano’s after a difficult start to the quarter
Source: NRN
Ron Ruggless
Apr. 23, 2013
After a challenging environment in January and February, Brinker International Inc. reported Tuesday that March same-store sales improved at its Chili’s Grill & Bar and Maggiano’s Little Italy brands and helped the company log a third-quarter profit.
For the quarter ended March 27, Brinker reported net income rose to $52 million, or 71 cents per share, from $44.9 million, or 56 cents per share, in the same period last year. Revenue inched up 0.1 percent to $724.8 million.
The company’s operating margins improved to 17.9 percent from 17.2 percent in the year-earlier period amid some easing of commodity prices and mid-quarter introductions of a new pizza platform, executives said in a conference call with analysts.
Same-store sales at restaurants open at least 18 months fell 1.1 percent at Chili’s and rose 0.4 percent at Maggiano’s during the quarter. Consolidated same-store sales for both brands fell 0.9 percent.
Chili’s sales turned positive in March, coming in at 1.3 percent for the month after being negative in January and February, the company said.
“We had a bad February, clearly,” said Guy Constant, Brinker’s chief financial officer. “I think the whole space did. We’re happy it’s over. I think what we are seeing now in terms of the macro economy is kind of where we’ve been over the past two or three years.”
Constant noted that the quarter was marked by slow job growth and muted consumer confidence. “But we know we can generate results in that kind of economy,” he said.
Wyman Roberts, Brinker’s chief executive and president, told analysts he remained confident about the new menu platforms made possible with kitchen remodels.
“The rollout of our new kitchens is complete across our domestic system, with the franchise system now fully online, ” Roberts said. “With this new equipment in place, we’re exploring menu innovation we wouldn’t have had capability to execute in the past.”
Pizzas and flatbreads are among the first new menu offerings out of the new kitchens. “We’re excited about the potential this [pizza-flatbread] category has for us to introduce more guests to the product – a product, by the way, that has the added benefit of better-than-average margins,” Roberts said. Flatbreads will be rolled out to the entire system in the fourth quarter, and Brinker expects to see it produce margin improvements as well as help increase traffic when advertising and marketing support get behind both pizzas and flatbreads.
“That’s when we’ll have the messaging that I think really has the potential to drive traffic,” Roberts said. “I think pizza can do some good things for us, but it’s really the combination of pizzas and flatbreads that could get this to a scale for a message that is compelling to drive some traffic.”
The pizzas and flatbreads will also be offered in the “2 for $20” dinner and lunch combo menus. “It will be available to our guests in various different places on the menu,” Roberts said.
“We anticipate guest excitement for the category will continue to build with the rollout of flatbreads in the next few weeks,” he said. “In the future, we see the potential of the pizza and flatbread category mixing up to 10 percent of our menu.”
Brinker extended its reimaging program to 47 more restaurants in the third quarter, bringing the total so far to 316, the executives said. The company expects to have 370 reimaged restaurants by the end of the fiscal fourth quarter. Constant said the company aims to achieve a 3-percent sales lift at the reimaged units.
At the Maggiano’s brand, Brinker has been emphasizing the beverage programs. “Our skilled bartenders are creating handcrafted classic cocktails featuring fresh-squeezed juices and handmade garnishes,” Roberts said, noting that those cocktails, as well as a new option that allows guests to trade up to a nine-ounce wine pour, “have made a measurable impact” on checks.
In the international division, Brinker added six new restaurants, including the new market of Colombia. The company has units in 32 nations outside of the United States.
Brinker has a total of 1,268 domestic Chili’s units and 44 Maggiano’s units in addition to 276 international Chili’s units.
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EAT: First Take: 3QFY13 in line with expectations on all key metrics
Source: Goldman Sachs
Apr 23rd
News
EAT reported adjusted fiscal 3Q13 EPS of $0.72, ahead of GS/consensus estimates of $0.69. Revenues of $743mn were roughly in line with consensus, but profitability was solid ($0.01) and the company benefited from a lower tax rate in the quarter ($0.02). It reiterated its guidance of $2.75-2.80 EPS by 2014, ahead of the current $2.72 consensus.
Analysis
Revenues – Chili’s SSS of -1.1% were roughly in line with our -1.0% estimate and the -0.9% consensus. On a monthly basis, January came in at -0.4%, February at -4.3% and March was +1.3%; tracking similar to overall industry trends. In March, Chili’s results split the Knapp Track and Black Box figures suggesting sales trends that are in line with the industry. The company did not comment on April trends post quarter close that would include the impact of its recent pizza launch.
Margins – Restaurant margins of 17.9% split our 17.7% estimate and the 18.0% consensus. This compares favorably to last year’s 17.1% level. We see this as strong as the company’s ongoing cost-cutting efforts more than offset any de-leverage from the negative SSS in the quarter. Corporate operating margins of 10.9% were in line with Street forecasts, but above our 10.4% estimate, with lower SG&A driving the delta versus our model.
Other – EAT repurchased another $60mn of its shares in the quarter, bringing the total to $192mn through its fiscal 3Q. The 5.8mn repurchased shares represent a 7% reduction from its year-end 2012 share count through the first three quarters of this fiscal year.
Implications
We expect a muted stock reaction as the quarter was more or less in line with expectations, pending any commentary on the call regarding April trends. Our estimates and price target are unchanged.
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EAT: SSS, margins and FCF deployment all on track – Buy on weakness
Source: Goldman Sachs
Apr 23rd
What’s changed
We reiterate our Buy rating on EAT shares on the heels of its fiscal 3Q13 earnings, and encourage shareholders to buy on today’s weakness.
Implications
(1) A primary reason for today’s sell-off relates to March/April SSS trends; however, we believe SSS are in better shape than is broadly appreciated. Last year in March Chili’s SSS were +3.5%, driven by the successful steak launch, versus -0.3% for Knapp Track, and it is now anniversarying that promotion. On a two-year basis, Chili’s SSS outperformed Knapp Track in March by the widest variance in months. As such we expect Chili’s SSS to reaccelerate against easier compares in the coming months.
(2) Margins continue to come in better than anticipated with restaurant level margins +80bp and EBITDA margins +170bp year-on-year – in spite of de-leverage associated with the February slowdown. Both labor and restaurant expenses were actually down in dollars this quarter. We raise our 2013-2015 EPS estimates to $2.33/$2.83/$3.27 primarily to reflect higher profitability assumptions going forward.
(3) FCF deployment remains robust with buybacks up to $192mn through three quarters, effectively reaching our prior estimate for the year. Given that EAT ended the quarter with $86mn in cash on the balance sheet, we raise our estimate for repurchases for the year to $225mn. Further, we are now modeling for sustained 7% share count reduction per year in out-years (in addition to EAT’s 2-3% dividend yield).
Valuation
We retain our $44 P/E and DCF-based 12-month price target, which equates to 17% upside in EAT shares.
Key risks
The primary risk is lower-than-expected SSS, either due to the macro environment or from company-specific missteps.
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The die is cast as Caesars splits in two
Source: FT
By Henny Sender
Apr 23rd
Caesars Entertainment, the debt-laden casino company acquired by Apollo and TPG near the height of the buyout boom in 2008, is to split into two companies as part of a capital restructuring involving fresh equity investments that could reach $1.2bn.
Apollo and TPG will inject a combined $500m into the new entity, known as Caesars Growth Partners, with up to $700m coming from Caesars Entertainment shareholders and investors that backed the buyout team’s $30bn takeover of the casino company formerly known as Harrah’s Entertainment.
Caesars Entertainment’s stake will range between 57 per cent and 77 per cent, depending on how much of the $700m is committed.
Caesars Growth Partners will use the equity to pay $360m to Caesars Entertainment for stakes in Planet Hollywood Resort & Casino in Las Vegas, and Horseshoe Baltimore, a casino venture under development in Baltimore. It will also hold bonds with a face value of $1.1bn.
The restructuring is “intended to improve the company’s capital structure and provide support for new projects”, Caesars Entertainment said. It would allow Caesars “to fund growth opportunities in a less leveraged and more flexible vehicle”.
Caesars Entertainment shares jumped 29 per cent to $16.11 by lunchtime in New York, valuing the company at $2bn. At the end of 2012, Caesars Entertainment had about $23bn in gross debt.
Even in pliant capital markets, “there are limits to additional debt financing”, said a person familiar with the matter. “Already the leverage on the company is so expensive. But everyone wants and needs this company to grow.”
It has already undergone a complex series of debt refinancings to improve its financial footing.
The capital restructuring comes as another large deal struck at the height of the buyout boom grapples with its debt burden.
TPG along with KKR and Goldman Sachs is fighting to keep portfolio company Energy Future Holdings from sinking under the weight of its $46.6bn debt load.
Apollo, one of the biggest holders of EFH’s debt, sits on the other side of the table from its private equity rivals, underscoring the sometimes complicated nature of relations between private equity groups.
Buyout groups often keep money in reserve from their funds to support ailing companies in their portfolios that they believe can be saved.
When the original Caesars investment was made, casino companies were believed to be relatively immune to economic downturns. However, the company has struggled under the weight of its debt burden as the value of its assets tumbled.
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California: California 4am last call for alcohol proposal rejected
Source: ABC 7
Tuesday, April 23, 2013
It looks like last call for alcohol will continue to be at 2 a.m. in California.
After the Democratic majority struggled over which way to vote, a state Senate committee rejected a controversial proposal giving cities and counties the power to extend bar hours like their counterparts in New York, Las Vegas, New Orleans and Miami. California’s last call would have been 4 a.m.
Opponents urged lawmakers to think about public safety. When one jurisdiction closes at 2 a.m. while another closes at 4 a.m., law enforcement warned the situation would create what they call “liquor commuters.”
“People driving to those other locations, and then after having consumed many times a substantial amount of alcohol, driving back,” said John Lovell, a lobbyist for the California Police Chiefs Association.
Low-income neighborhood activists pointed out that there’s already a big alcohol problem in the state and said the last thing California needs is more opportunities to drink.
“You go down one block to another and you’ll have three to four mom and pop stores with liquor licenses. We don’t need an extension of the ability to drink – not in the state of California,” said Richard Zaldovar of the Las Memorias Project.
But Sen. Mark Leno, who carried the bill, insisted cities that allow longer bar hours do not experience higher rates of alcohol-related crashes than places with normal hours. In this 24/7 society, the San Francisco Democrat says services need to cater to all groups.
“Not everyone is working 9 to 5, Monday through Friday, and for that reason I think it makes sense to consider this extra hour or two of alcoholic services,” Leno said.
Dollars are also driving the push for extended bar hours. Leno said strict drinking hours are costing businesses money, and a 4 a.m. last call would allow California bars and restaurants to keep up with the nightlife in other major U.S. cities. Leno said a later last call would provide communities with more jobs, tourism and local tax revenue.
Some city leaders and bar owners say the Golden State is at a disadvantage when trying to lure conventions and tourists.
“We’re losing a lot of our people to places like Las Vegas, to New York, to Miami,” said Robert Vinokur, who owns six restaurants in L.A. “People don’t want to come to California, Los Angeles, San Francisco, San Diego.”
The committee’s decision doesn’t mean the fight is over. Supporters of extended bar hours are considering a ballot measure asking state voters to decide on the issue in 2016.
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Washington: State House Dems drop beer tax, other revenue proposals
Source: AP
By MIKE BAKER
Apr 23, 2013
House Democrats in Washington state have dropped their plan to extend the state’s beer tax and backed away from other revenue proposals they felt were distracting.
Democratic Rep. Reuven Carlyle, one of the chamber’s budget writers, said the beer tax might have been subjected to a ballot challenge from large beer companies. He said he thought it and other proposals could have created problems for the larger goal of increasing funding for education.
“Some of those items were particularly distracting from our success,” Carlyle said. “Goal No. 1 is to be successful at getting a revenue package to fully fund public education.”
The beer tax extension would have raised a projected $60 million over the next two years. The Democrats also dropped a plan to eliminate tax breaks for insurance agents and dockworkers, which would have raised more than $80 million. They also passed on a proposal to pursue a sales tax on janitorial services, which would have brought in an estimated $41 million.
The House is still pursuing a variety of tax changes, including the extension of business taxes that would raise $620 million over the next two years. Senators have approved a budget without those tax changes, and the two sides are now involved in final budget negotiations.
Lawmakers are under pressure from the state Supreme Court to increase funding for education while at the same time dealing with a projected revenue shortfall. Senators have accomplished that by a variety of fund transfers and cuts to social services programs, while the House has argued that the Senate budget is unsustainable.
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Texas: Beer bills pass “another hurdle” with unanimous House committee vote
Source: The Chronicle
Tuesday, April 23, 2013
The closely watched package of bills that would give Texas craft brewers new ways sell their product was unanimously passed this afternoon by the House Licensing and Administrative Procedures Committee.
Rick Donley, president of The Beer Alliance of Texas, a distributors group that has supported the legislation throughout the session, called it “another hurdle overcome.” The five related bills, identical in wording to those already passed by the Texas Senate, were sent to the Calendars Committee before a full House vote.
In what would be among the biggest changes to the state’s beer laws in 20 years, the legislation would allow breweries to sell a limited amount of beer in their own taprooms for consumption on site. Another major provision would allow brewpubs to package beer for sale in groceries and other off-site outlets.
The Beer Alliance issued the following statement from Donley:
We commend Chairman Wayne Smith and members of the House Licensing and Administrative Procedures Committee for today passing a package of Senate bills intended to create a more robust malt beverage marketplace.
Senate Bills 515, 516, 517 and 518 by Senator Kevin Eltife, sponsored in the House by Chairman Smith, will open markets in Texas more broadly to the fast-growing craft brew sector. Craft beer makers and brewpub owners will, upon full House passage, be able to produce, market and sell greater quantities of product to Texas consumers, and, importantly, add to greater employment in the craft brew sector.
Additionally, Senate Bill 639 by Senator John Carona, sponsored in the House by Chairman Charlie Geren, brings additional regulatory certainty and clarity to marketing practices of beer wholesalers.
The Beer Alliance of Texas looks forward to working with all members of the Texas House of Representatives on enactment of this important consumer legislation.
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United Kingdom: Supermarkets ‘distorted’ scientific findings on alcohol
Source: The Independent
JEREMY LAURANCE
Wednesday 24 April 2013
Leading supermarkets and drinks companies distorted evidence in an attempt to prevent the Scottish Government introducing a minimum price for alcohol, researchers say.
Academics from the London School of Hygiene and the University of York examined 27 submissions by the alcohol industry to the Scottish Government’s consultation. They claim the industry “ignored, misrepresented and undermined” the scientific evidence.
Tesco, Asda and the Wine and Spirit Trade Association (WSTA) were among organisations that sowed doubt about the Scottish Government’s plans, questioning the evidence on which they were based and citing small, poorly carried-out surveys suggesting they would not curb problem drinking, according to the academics.
Tesco claimed there was “little evidence” to support the impact of prices on consumption, while the WSTA cited a small trial that contained “weak evidence” in support of its counter-view, the researchers say. Asda claimed that minimum pricing would create a black market in alcohol sales. The Portman Group, an alcohol industry-funded organisation which promotes responsible drinking, even warned that restricting sales could create a “mystique” around alcohol, turning it into a more desirable “forbidden fruit”.
Dr Jim McCambridge, who led the study published in PLOS Medicine, said: “There is a broad consensus internationally among researchers that the most effective measures to control problems caused by alcohol are to raise the price, control availability and restrict marketing activities. However, our study shows that key players in the alcohol industry constructed doubt about this wealth of scientific evidence and instead chose to promote weak, survey-based evidence, as well as making unsubstantiated claims to their advantage.”
But their attempts to derail the Scottish plan failed and the Alcohol (Minimum Pricing) (Scotland) Act 2012, banning the sale of alcohol below 50p a unit was passed in May last year, although it is now being challenged in the courts.
The academics fear that drinks producers and retailers may have used the same methods to stave off attempts to introduce a minimum price in England during the Home Office’s consultation on the issue.
A minimum price for alcohol has been backed by David Cameron but now looks set to be dropped amid reports of a cabinet split.
Unlike in Scotland, not all the submissions to the English consultation are publicly accessible, raising “concerns over the alcohol industry’s ongoing involvement in alcohol policy-making for England and Wales”, the researchers say.
A spokesperson for the Portman Group said: “Our 2008 response is published in full on our website and does not misrepresent anything. In it, we say that public policy should focus on tackling the irresponsible elements of our drinking culture and not penalise the majority of moderate, responsible drinkers who are doing the right thing.”
Miles Beale, chief executive of the WSTA, said: “It is disappointing that this study fails to recognise the good work being delivered by the drinks trade, health community and Government working in partnership, as it seeks to deny the trade from contributing to the debate.”
Tesco and Asda referred requests for comment to the WSTA.
Tesco claimed there was ‘little evidence’ to support the impact of prices on consumption
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United Kingdom: Anna Soubry: Minimum alcohol pricing is still Government policy
Source: The Telegraph
By Peter Dominiczak, Political Correspondent
23 Apr 2013
Miss Soubry, the MP for Broxtowe, suggested that her senior Cabinet colleagues abandoned plans to have a minimum price per unit of alcohol over fears that it would lead to accusations of a “nanny state”.
In an interview with Total Politics magazine, Miss Soubry also hit out at Conservative colleagues plotting against the Prime Minister, accusing backbenchers of engaging in “quite a lot of twattery”.
“The Tory Party must learn from its own history that when we fight each other, you can guarantee to lose,” Miss Soubry said.
The plan to set a minimum price of alcohol at 45p a unit was abandoned in the budget amid opposition from the Home Secretary and Treasury officials.
Critics of the policy say it will unfairly raise the price of wine, beer and spirits for responsible drinkers who do not have a problem with alcohol.
Estimates suggest it could add 70p to the price of a bottle of cheap supermarket wine and £2 to a bottle of gin or whisky.
Mr Cameron had previously been one of the main advocates of a minimum alcohol price, claiming that making drinks more expensive would curb problem drinking.
Miss Soubry insisted that she is still “convinced” that minimum pricing is correct and claimed that the measure is “still official policy”.
“Don’t get me wrong,” she added. “I absolutely understand why it would be that someone at a senior level in government was saying, ‘Well, the political cost would be. [that] it looks like a step too far, it looks too much of a nanny state’.
“You have to get the balance right, especially with public health, so that you take the measures that benefit the public’s health, but without causing people to resent you so that you actually don’t cure the ill that you seek to cure.”
Elsewhere in the interview, Miss Soubry attacked Tory MPs criticising Mr Cameron’s leadership.
There has been growing speculation in recent months of a backbench plot to unseat the Prime Minister.
“When people talk about such-and-such a person as an alternative to Cameron, there is no vacancy,” Miss Soubry said. “What we now need to do is stop people in the party engaging in quite a lot of twattery, and to accept that we’ve achieved a huge amount, and it’s all to play for.”
She added: “I came into politics to fight lefties. that’s where political fighting goes. The Tory Party must learn from its own history that when we fight each other, you can guarantee to lose.”
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