Becle SAB de CV
BMV:CUERVO
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Becle SAB de CV
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Good morning. Thank you for holding, and welcome to Becle Second Quarter 2018 Earnings Conference Call. As of this morning, we have Juan Domingo Beckmann, Chief Executive Officer; Luis Felix, Managing Director of Mexico; Gordon Dron, Managing Director of EMEA and APAC; Steve Shanley, Senior Vice VP of Commercial Strategy for Proximo; Luis Carlos de Pablo, Corporate Finance Director; and Michael Cheek.
Before we begin, I would like to remind you that the figures discussed in this call were prepared in accordance with International Financial Reporting Standards or IFRS and published in the Bolsa Mexicana de Valores. The information for the first quarter of 2018 is preliminary and is provided with the understanding that once financial statements are available, updated information will be shared in the appropriate electronic formats.
During this call, you may hear certain forward-looking statements. These statements may relate to our future prospects, developments and business strategies and may be identified by our use of terms and phrases such as anticipate, belief, could, estimate, expect, intend, may, plan, predict, project, will, goals, target, strategy and similar terms and phrases and may include references to assumptions.
Forward-looking statements are based on our current expectations and assumptions regarding our business, the economy and other future conditions. These forward-looking statements relate to the future by their nature. They are subject to inherent uncertainties, risk and changes in circumstances that are difficult to predict. Our actual results may differ materially from those in forward-looking statements.
For all the foregoing reasons, you are cautioned against relying on such forward-looking statements. Information discussed on today's call may include forward-looking statements regarding the company's results and prospects, which are subject to risks and uncertainties. Actual results may differ materially, and the company cautions not to place undue reliance on these forward-looking statements.
Becle undertakes no obligation to publicly update or revise any forward-looking statements whether as a result of new information, future events or otherwise. All results are expressed in full U.S. GAAP. [Operator Instructions]
Now, I will pass the call onto Mr. Juan Domingo Beckmann, CEO of Becle.
Good morning. Thank you for joining us today to discuss Becle second quarter results. I will make some opening comments, and then I will ask Ms. Felix to review our Mexico and Latin America business. Steve Shanley will update you on the U.S., and Gordon Dron will discuss our results in EMEA and APAC regions. Ms. Carlos will then walk you through our financial results.
We reported 4% net sales growth during the second quarter. In the U.S., depletion growth was strong. We continued positive trends throughout the second quarter. Shipment volumes was 6% lower in the second quarter of 2017 due primarily to reduced distributor inventory levels. We also generated strong results from our recent acquisition of Pendleton Whisky and continue to review opportunities for additional acquisitions across the global spirits industry.
In Mexico, we continue to generate market share gains in both tequila category and total spirits. From a margin perspective, we continue to face higher-than-expected agave costs, which helped cause a decrease in our gross margin by approximately 200 basis points.
We remain well positioned in each of our markets and categories and have strong financial position with significant capital to successfully execute our long-term growth strategy.
I will now turn the call over to Luis Felix to discuss our performance in Mexico.
Thank you, and good morning, everyone.
We had another strong quarter in Mexico, with 12% net sales growth and strong shipments. While our reported shipments volume show a 2% decline, this decline was driven by last year's distributor transition from our B:oost energy drink brand. During the second quarter of 2017, we shifted B:oost distribution to Jumex and filled our initial pipeline order, which led to an unfavorable year-over-year comparison for the quarter. Excluding B:oost, the second quarter shipments volume increased 12%, and net sales increased 18% compared to the prior year. Our tequila shipments volume also remained strong, growing 16% during the second quarter and above category benchmark. We expect B:oost shipments to recover in the third quarter, as we continue to see positive commercial trends with the brand.
Our second quarter performance was led by continued strong growth of our tequila super premium brands. Tequila now is the fastest-growing spirit in Mexico, driven by growth of super premium brands, with a very strong performance of 1,800 in Maestro Dobel, which was up over 50% and is taking market share in the super premium segment. Across the entire tequila category, our family of brands increased market share during the second quarter to 39.8% in volume and 37.5% by sales value. Across all spirits, we increased market share to 20.2% in volume and 19.2% in sales value.
Turning to Latin America. Shipment volume was flat, and net sales increased over 10%, driven by Colombia and Panama.
In summary, we had a strong second quarter and first half of the year. Depletions also remained positive, growing 9% in the first half of the year. We entered the second half of the year with good momentum and less than 2 months inventory at the trade. We are in good position for the second half of the year.
Now let me turn the call over to Steve Shanley to discuss the U.S. and Canada business.
Thank you and good morning, everyone.
Commercial trends for Proximo in the U.S. and Canada improved during the second quarter. Consumer takeaway, as measured by Nielsen and [indiscernible] data, grew during the quarter. And depletions for the quarter were up 5%, and 7% if we exclude Jose Cuervo Margarita Mix.
Importantly, we have now recorded 4 consecutive months of depletion growth dating back to March. With our depletion of -- tequila and whiskey category is driving a significant portion of this growth. Tequila depletions, driven by double-digit growth in our super premium offerings, were up 7% overall. Our whiskey depletions grew 15% organically for the quarter, and we have enjoyed a great start with our most recent acquisition of Pendleton Whisky. Pendleton recorded double-digit depletion growth during the second quarter as we continue to gain distribution nationally. Our ready-to-drink margarita category regained momentum and recorded 9% depletion growth during the quarter, and we have seen good success with recent flavor innovation. In vodka, the launch of our newest innovation, rosé-flavored vodka under both the Three Olives and Hangar 1 brands, performed well, helping to offset the portfolio rationalization that we commenced last year in a very competitive flavored vodka segment.
Despite the strong consumer takeaway and depletion growth, we recognized lower shipments compared to the prior year. The 7% decline in shipment volume resulted from inventory levels below historical averages throughout the supply chain.
In conclusion, we are pleased with the commercial trends in the U.S. and Canada. The increased focus on our full portfolio created by the development of our signature brands division is already paying off. We continue to grow net sales value per 9-liter case with improved brand mix and size mix within the brands, and we expect this premiumization trend to continue and impact sales positively going forward.
Let me now introduce you to Gordon Dron, Managing Director of our EMEA and APAC regions.
Many thanks, Steve, and good afternoon from Europe.
As this is the first time I've been on one of these investor calls, I'll briefly introduce myself. I'm based in Dublin, Ireland, and I manage our EMEA, APAC and global travel retail business.
The EMEA and APAC regions continue to perform well. Depletions grow strongly with double-digit growth during the first half of the year. Shipments growth slowed during the second quarter, but this is anticipated following the strong shipments in the first quarter, in which we reported 18% growth versus last year.
Kraken remains our star performer, showing greater than 20% growth in both shipments and depletions. Our major Kraken highlight of the quarter was the passing of 100,000 case 12-month volume threshold in the U.K. market, which remains the leading market for the brand outside the United States.
Jose Cuervo brand shipments were running slightly behind last year at the end of the first half. This was driven by our decision to limit shipments to markets in which goods were found to be moving externally as well as changes created by the economic situation in Russia.
Turning to Bushmills. We continue to see positive trends, with mid-single-digit growth in depletions despite lower volumes in Russia, where our distributor faces challenges across its portfolio, but our brand health remains strong.
Moving to APAC. Business is growing rapidly in South Korea, following an improvement in the local sentiment with the forming of relations with North Korea. China, where Jose Cuervo is now one of the top 10 imported spirits brands, reported double-digit growth.
So in summary, we remain confident with our outlook for the remainder of the year, and we are pleased with our first half performance.
And with that, I will now turn you -- the call over to Luis Carlos to review the financial results.
Thank you, Gordon.
Let me walk you through the second quarter financial results. During the second quarter, the company reported a 3.6% net sales increase to MXN 7.2 billion. Growth was driven by a 17.1 net sales increase in Mexico and 11.9 growth in the rest of the world, partially offset by a modest 0.4% decline in the U.S. and Canada. Net sales growth benefited from favorable sales mix across all regions and, to a lesser extent, positive foreign currency effects. Total shipment volume decreased 5.9% during the second quarter. As discussed, shipment volume comparisons to the prior year period were impacted by reduced channel inventory levels in the U.S. market. However, depletions showed growth in all regions during the second quarter of 2018.
During the second quarter of 2018, gross profit was MXN 4.4 billion. As a percentage of net sales, the gross profit margin decreased 750 basis points to 61.1%. Consistent with what we've discussed during the first quarter, the decrease in gross profit margin was primarily driven by a combination of a lower percentage of internal -- internally sourced agave during the second quarter compared to the prior year as a result of the timing of internal agave usage and the higher-than-expected agave prices. In addition, certain sales and promotion expenses in Mexico now being met against sales rather than AMP spending.
AMP as a percentage of net sales was 24% during the second quarter, in line with 23.5% in the second quarter of 2017. Operating profit decreased to MXN 1.7 billion or 23.1% of net sales. And EBITDA decreased to MXN 1.8 billion or 24.9% of net sales. Operating profit was not only affected by higher cost of goods but also higher distribution cost due to higher fuel prices.
Net comprehensive financial result this quarter was a positive MXN 367 million, mainly reflecting the noncash impact of a quarter-to-quarter Mexico peso exchange rate appreciation on cash held in U.S. dollars.
Second quarter consolidated net income increased 45.1% to MXN 1.5 billion or MXN 0.40 per share. The company's cash balance as of June 30, 2018, was MXN 13.4 billion. This compares to total debt of MXN 9.9 billion.
We remain in a very strong financial position with significant surplus cash and the capacity to add additional leverage if the acquisition opportunities materialize.
I want to thank you for your interest in Becle. And I will now turn the call back over to the operator to begin the question-and-answer session.
[Operator Instructions] Your first question comes from the line of Andrea Teixeira from JPMorgan.
So I wanted to just go back to the comments about the U.S. So wondering, you're coming off of 2 quarters of destocking at the wholesale level. So I was trying to reconcile that with the objectives that you had discussed in the last call, which embedded low single digits growth in volumes and mid-single-digit total revenue growth. So I wanted to just go back to that point to see how you're tracking and if you believe that's achievable for 2018 or that's more of an aspiration for 2019. And then also if you can update us on the search for the CEO of Proximo and the CFO of the company.
Andrea, it's Steve Shanley. I'll take the first part of that, and then I'll pass it to Mike Cheek to answer the search question. But indeed, we still are on track for that lower or mid-single-digit growth from a sales perspective, and we do believe that our NSV will come in slightly above that. The destocking of a distributor, it is -- it was accounted for in those discussions that we had in the last quarter, and we have prepared a forecast that gets us to those levels.
And on that, just to be clear, so you're assuming that you are going to be able -- in the fourth quarter, that you're going to be able to grow in the mid-teens in volumes, in shipments. Because I'm assuming the third quarter is still going to have some weakness on the volume because of tough comps. And you grew 17% in the third quarter of last year in the U.S. and Canada. So I'm assuming that, that's going to be more pushed back into the fourth quarter on a mid-teens type of volume growth.
Yes. Again, we don't want to provide specific guidance, but we are very -- we are comfortable with our original forecast of mid-single digits and slightly better NSV for the full fiscal year. You have to understand as well that the change in fiscal years that we undertook when we issued the IPO has made some of the quarters hard to our comparison. So the 17% that you saw last year, while strong against the previous year, was going against the previous year that just followed the end of a fiscal year. So some of those comparisons are -- get a little out of line.
Andrea, this is Mike Cheek responding to your question on our progress on the CEO search. We're very pleased with the progress we're making to date. This is a very exciting opportunity, one that is, today, are categories of -- strong growth categories in the industry. We've got a lot of interest. Certainly can't be specific on candidates, but we've already begun the interviewing process. We're looking for a strong candidate. We're looking for candidates that have great experience in this business and candidates who will be committed to helping us reach and achieve our long-term goals. Certainly expect to conclude this search during this calendar year. So net-net-net, we're very pleased with the progress we're making to date.
Your next question comes from the line of Benjamin Theurer from Barclays.
Just wanted to follow up, and it's something similar I've asked [indiscernible] during the first quarter, and we've discussed that a lot, the agave pricing. So if we consider -- and you've mentioned it, and thanks for the clarification that there was about a 100 basis point impact on gross margin from agave. So just trying to understand properly, where were we in the first half and specific in the second quarter in terms of how much was internally sourced agave? How much was purchased? And what do you expect in terms of headwind into the second half because of the pricing the externally sourced agave is currently having? And is there any flexibility you have to, well, shift some of the internal sourcing around as you've done it in previous years? So that will be my first question, and then I have a follow-up.
Yes. Benjamin, how are you? We are at the integration level targets that we said that we will have for the full year. We are at 70% internally sourced. We are maintaining that percentage of integration all throughout the year, and that's what we expect to continue. We don't expect the trends of the agave prices nor our integration target to change in the short term.
So in other words, the pressure is likely to continue into the second half from a gross profit point of view. Correct?
That is correct.
Okay. And then just if you could give us a sense then. We've been talking about this gap, what we see depletion growth versus would you actually sell volume would you recognize. Could you somehow give us a sense what the inventory levels at the distributors in the U.S. currently are and when you would expect that what is depletion growth is somewhat more aligned with volume growth? Because we've seen a significant discrepancy on those 2 data points.
Yes, I'll take that. It's Steve Shanley. Yes, the distributor inventory is -- when we look back over the last 2 years and we look at both December and June periods, it is the lowest that it's been for any of those periods dating back 2 years to before the IPO. There's a few things that were in play there as well. I don't want -- I prefer not to speak about the distributor partners or their operations and how they control their inventory, but we are aware that Young's Market went through an ERP conversion in January, February of this year. And I can only surmise that this may have had something to do with their changes and their inventory. Half of the destocking, if you will, came out of California alone, and then the rest of it is roughly about 6 or 7 days of inventory change between where we were in December and where we are now in June. So a good portion of it was in one particular market where I can only anticipate that they -- they anticipated some issues with their ERP and wanted to ensure continuity of business.
Okay. Perfect. Do you think or do you sense, and that's just, I promise, my last question, this has anything to do with competition in the Tequila segment in some of the markets where the distributors just don't want to have too much inventory of one specific brand and be more diversified? Or is there a general drawdown in your competitive positioning and your market share and you gave the levels in Mexico? And generally, is that something that has stayed somewhat the same?
Yes. It's not concentrated in a specific category. Obviously, Especial is our biggest brand. So if you counted the cases, yes, that's contributed to Especial more than the other brands. But from a percentage standpoint, it's pretty widespread across most of our categories.
Your next question comes from the line of Felipe Ucros from Scotiabank.
Yes, sorry. My questions have been asked.
Your next question comes from the line of Antonio Gonzalez from Crédit Suisse.
I wanted to come back to the U.S. as well. I guess, first thing I'd like to ask and see if you can give us a little bit more color. Last quarter, we also saw, as it's been asked already in previous questions, a significant mismatch between shipments and depletions. And last quarter, the rationale that you share with us was destocking taking place at the retail level, right? There, our understanding, please correct me if I'm wrong, I thought it was somewhat surprising to you. As you came into the quarter, the mismatch was actually larger between shipments and depletions. And then as the quarter progressed, you somewhat managed to narrow this gap. And it appears as if the mismatch this quarter is coming from a completely different reason. So I just wanted to clarify whether that's the case. Are -- have these been surprising developments in your view? I guess, I'd like to start there. Or, to some extent, have you foreseen these changes both -- they weren't simply shared with, I guess, investment community for competitive reasons or else.
Yes, I don't know that we anticipated a distributor destocking. Again, California separated from the rest of it, a rough decline of 6 or 7 days of inventory drawdown from December to January in the remaining businesses. There is always a level that is within the range of what we would expect. 6 or 7 days of inventory is not unheard of for the inventory to move one way or the other. Again, we have a different financial close now that we're in December versus June distributors are creatures of habit as far as their ordering process. So there's a number of different variables that would have needed to be anticipated in order for us to anticipate the drawdown that we've seen. Just to clarify one point that you made, the surprise of the first quarter was around the depletion number, which was recorded at a minus 4%, and that was related to a few markets that had taken the price increase late in 2017 and created tough comps for us. If you strip those markets out, the depletion growth for the first quarter and the second quarter are pretty comparable at roughly 5%. So we see a good trend in the business from a commercial standpoint, which is what we follow and we like to use to project our future. So these movements in inventory are more noise than they are an issue with the overall business.
I see. Okay. Secondly, if I may, I wanted to ask. Excluding California, right, from -- if I'm understanding correctly, there's a large part of the problem coming from California, but there's some inventory reduction elsewhere happening across different distributor partners with whom you pursue business. If that's the case, do you see these more as a recurring theme coming from, I guess, consolidation in the distribution peer or perhaps specific to the Tequila segment in particular? Is there any rationale, again, beyond the ERP integration that you just described for California? Is there a more recurring theme, consolidation-driven, category-driven, that, I guess, has triggered a new normal in terms of the base of inventory for your business after distribution peer?
Well, I'm sure you're aware of the, I guess, announced and impending transaction between Breakthru Beverage and RNDC. And obviously, both of those units, I would imagine, although we don't do business with Breakthru anymore, both of those units are watching their capital and probably being scrutinized more than they ever have been. So you may hit on something there when you talk about distributor consolidation and this perhaps being a temporary situation where they're looking to hold less inventory. But we'll continue to monitor it. We don't want to put words in our distributors' mouths as far as what their reasons are or why they might be moving their inventory levels.
That makes sense. I'm sorry to take so much time, but last one, if I may. Just from your conversations today, whether it's being driven by ERP migrations or else, what your distributor partners tell you today is that this short-term disruption that we saw in the second quarter is mostly over? Or do you see still some adjustments taking place at the moment in the base of inventory that they'd like to work with?
Historically, we're at the low end of where we've seen the inventories be maintained over any period of time. I wouldn't anticipate any further destocking. What levels we finish at, at the end of the year, I can only surmise that we've been at a consistent level every 6 months for the last 2.5 years, and that will return to that level going forward. Haven't had a specific conversation, but that's pretty much what we're planning on.
Your next question comes from the line of Luis Miranda from Santander.
This first one is a follow-up on the COGS. And I just want to double check what, Domingo, you mentioned in your segment. I understood a 200 basis point from the increase in the price of agave and -- or it was 100. I just want to clarify that. And with -- following that idea, is that -- we have seen that the price of agave was stable for the -- at the beginning of the year, and then we start to see some rebound during the second half. I don't know if you could tell that -- if it has stabilized from the prices you saw during the second half. Or are we still seeing additional pressure entering into the second half of the year? And my follow -- my second question is with regards to the change in accounting in IFRS. How much of that impact is on COGS?
Luis, how are you? I'm going to try to answer your questions. The first -- let's go backwards. On the last part of your question, we have about a MXN 50 million impact from IFRS accounting in terms of cost of goods. Then in terms of agave market prices, we are continuing to see pressure in the price of agave, and we don't expect those conditions to change over the course of the year. And the first part of your question was, again, if you can repeat it for me, please.
If, for the second quarter of the year, the impact from higher price of agave was 100 or 200 basis points on gross margin.
200 basis points.
Your next question comes from the line of Miguel Tortolero from GBM.
With all this mismatch between shipments and depletions in the U.S., I mean, this is something that the whole industry should be facing. I just would like to know if you have seen any material change in market share, specifically in the [ close-to-sell ] segment.
Actually, if you look at Nielsen, as I mentioned before, we have seen recovery for Especial within the premium or mid-priced category of tequila. We're up [ 2 ] share. If you look at the 13-week or the most recent 26-week, recovering from a softness that occurred last year after the price increase, obviously, the promotion from retailers and -- throughout the supply chain is reduced after you take a price up, and we're seeing the benefit of that and the recovery back to previous levels. So maintaining 74% in the mid-priced tequila category with Jose Cuervo Especial, which is back to where we were before the price increase.
[Operator Instructions] Your next question comes from the line of Mohammed Ahmad from FGP.
I just wanted some color on how we should view FX, particularly based o USD, impact on the quarter, both from maybe a revenue line and the cost line?
Well, if you recall, most of our income comes from U.S. dollars, and we keep all our excess cash in dollars as well. So all the impact of a peso devaluation is basically an appreciation of our cash at hand. So I don't know if that answers your question.
I was just wondering like -- sorry to interrupt, but I was just wondering if you will like start disclosing, like some companies do, constant currency, either revenue numbers or [ ESP ] numbers, just so we can see. Because sometimes, there's a mismatch between what the market [indiscernible], which we can get, versus what is really flowing through your income statement.
No. We won't do any changes into our disclosure.
Your next question comes from the line of Julie Chariell from Bloomberg Intelligence.
I've got a lot of questions on inventories in the U.S. I just wanted to clarify one thing. So it seems as though you feel that the inventories are at lowly low levels now among the retailers, and so I wanted to see if there's any reason why we shouldn't think that in the third quarter, depletion growth will now be closer to shipment revenue growth.
Yes, I would expect the shipments and depletions to marry up pretty closely for the quarter. And from a growth perspective, remember, you have to take into account the previous years' depletions and shipments, which I think we're pretty lined up for the third quarter. So I think both from a gross number, I think you'll see a lot more tracking moving forward and from a comparative percentage growth likewise.
Great. And if you can just talk a little bit more about some of the other products that had been pretty strong. Bushmills have been doing pretty well. If you can talk about how that is tracking. And can you give us any numbers on Pendleton as far as the revenue contribution in the quarter?
Yes, sure. The depletion number is -- just to clarify, the depletion numbers that I gave previously on whiskey include Pendleton in both the base year and in the current year. So those are true organic growth as we collected the previous distributor's depletion. So those are apples and apples. From a depletion standpoint on Bushmills, doing quite well, double digits year-to-date and even stronger for the quarter. Bushmills, if you remember, we introduced the Red variant last year. So we're going against some pretty tough comps in the second quarter but still performed quite well. And from a net sales value perspective, Pendleton is contributing roughly MXN 9 million for the quarter.
Your next question comes from the line of Andrea Teixeira from JPMorgan.
I just -- I'm still puzzled with the comments like now Julie asked if -- you mentioned, Steve, that you expect the third quarter depletions and shipments should be aligned. I think that was also the expectation in the last conference call for the second quarter. So I just want to reconcile that, because when you said that last year, the third quarter depletions against, from what I -- from my math here, actually, depletions were up -- shipments were up 17%. So that's -- I understand there is a lot of moving parts within a company that traditionally has looked at things on a biannual basis. But nevertheless, I mean, when you think about like the destocking that was taking place from the fourth quarter of '16, most likely, you're not going to see depletions and shipments migrate that fast back to shipments migrating to depletions. So I mean, I hope you understand that when you just mentioned that you kind of imply that you're going to grow mid-single digits in shipments already in the third quarter, I want to make sure that, that's what you mean.
Yes. Okay. I guess, to clarify your question, you're asking why we would have anticipated that in the second quarter and didn't happen versus our anticipation of the same thing happening in the third quarter. Again, we don't control the distributor inventory levels. Over the last 2.5 years, we've seen very consistent inventory levels. After the first quarter, we have seen a drawdown. Even at that point, it was below what we have seen in previous periods. We've seen a continued drawdown, but now we're at the bottom range of the levels that we've seen at any particular time of those 2.5 years. So I can only surmise that there won't be any further drawdown of inventories and that our depletions will convert to shipments moving forward. So that's why I'm able to make that comment.
And in terms of pricing, were you -- from that scenario, or you've been kind of promoting more? We saw some promotions [indiscernible] level. We don't know if it's actually more the Cinco de Mayo situation, towards the end of the quarter, or you're actually seeing retailers pushing back a bit for cheaper pricing towards the end of the summer season.
Yes. So again, as I said earlier, when you take a price increase, the retailer is less likely to feature you on an end cap and do display activity, and with that comes some feature pricing. They're less likely to do that because they don't want to convey a price increase to their consumer or their customer. So this year, going against the prior year where we had -- just had a price increase, yes, you'd probably see some promotional activity when you look at Nielsen. But I can reaffirm that our FOBs or what we're selling it for have only continued to increase as we've done a nice job at managing the size mix. Again, 1.75s of goals is the most price-sensitive. So those are what's probably driving much of the Nielsen data that you're looking at.
Now that's helpful. And then last clarification also on the ERP changes at the distributors that you said that half of what we've seen throughout the year so far has been on the California wholesalers. So how far do you think are they into implementing this ERP? And when do they start? So to -- to make sure we understand the cycle for them.
They started the conversion in January and February. My understanding is, is they continue to struggle with certain activities around that ERP system, but I don't feel comfortable going into any more detail than that on their behalf.
Your next question comes from the line of Felipe Ucros from Scotiabank.
The first one is maybe if you could dive a little deeper into the performance that Maestro has been having in Mexico. It looks like the performance on the volume side has been pretty incredible in the last few quarters, and I'm wondering what's pushing that from the Mexico side. And then also if you could go a little deeper into what happened at B:oost. What type of levels should be normalized? And has most of the effect of filling the pipeline last year already flowed through the system, meaning will the third quarter be completely unaffected by that? Or will we see -- or will we still have some effect of that?
This is Louis Felix. In the case of B:oost, it was only the shipments that we did in May and June last year. We placed orders, 319,000 cases, and that is like 115,000 cases more than the previous year. And that was only to fill all the different distribution centers that Jumex has around the country. So that is basically just onetime event. We have continuous review with them. The brand, B:oost, is growing more than 30% in their sale -- when they're selling from Jumex to the retailers. So we see that the brand is in good shape. And so we don't expect -- we expect basically on the third quarter to continue growing. So there will not be another effect in -- because that was only one effect in the second quarter. And in the case of the Mexico resource, yes, as you saw, we're basically growing in almost every category in -- specifically in tequila growing very strong. And that is -- Cristalino is a subsegment that is growing significantly, and we are very well positioned in 2 brands, which is 1800 and Maestro Dobel in the Cristalino area. Those 2 brands are growing more than 50% versus previous year and taking share from Don Julio. So I think we're very well positioned. We have -- even Cuervo Especial is growing 25% in our market. So I think we have very consistent AMP spending in Mexico and have very strong team in the on-premise. So that's basically what's happening in Mexico.
Just as a follow-up, if you're not seeing any change name, AMP spending, what's driving this kind of resurgence or increase in the category for Cristalino?
Well, I think that the consumers are seeing now more premium tequila. And the Cristalino segment, it's very appealing to men and women. And it's taking share from whiskey. Whiskey is still growing, but it's growing more in the low-end segment. So we believe that tequila is now taking some share from whiskey and other categories, and that is helping to reenergize the tequila category. So if you look at all the categories, tequila is the one that is growing most in Mexico. It's growing more than vodka, whiskey and other categories.
There are no further questions at this time. Mr. Domingo Beckmann, I'll turn the call back over to you.
I would like to thank you again for your continued interest in Becle. We remain extremely confident in our family of brands and our prospects for long-term growth. Have a great day. Thank you.
This concludes today's conference call. You may now disconnect.