ST. HELENA, Calif. – May 24, 2024 – The Duckhorn Portfolio, Inc. (NYSE: NAPA) (the “Company”) announced today that it has entered into distribution agreements with Republic National Distributing Company (RNDC) and Breakthru Beverage Group (BBG). The Company’s entry into these agreements is the culmination of a comprehensive strategic evaluation of its wholesale distribution network across the United States, with the goal of driving the profitable growth of the Company’s sales through a substantial increase in focus and investment in the wholesale channel. It is expected that RNDC and BBG will begin distribution of Duckhorn’s wines in their respective new territories during the summer.
“With the recent closing of our Sonoma-Cutrer acquisition, The Duckhorn Portfolio has grown in both scale and scope, and we are now the largest supplier of $15+ wines in the off-premise channel in the United States,” [1] said Deirdre Mahlan, President, Chief Executive Officer and Chairperson of the Company. “Acquiring Sonoma-Cutrer provided an excellent opportunity to evaluate and optimize our distributor network across the United States to strengthen our ability to drive consistent profitable growth and increase shareholder value.”
Recognized as a premier pure-play producer of luxury wine in the United States, The Duckhorn Portfolio includes eleven acclaimed winery brands: Duckhorn Vineyards, Decoy, Sonoma-Cutrer, Kosta Browne, Goldeneye, Paraduxx, Calera, Migration, Postmark, Canvasback and Greenwing. While the Company has worked with both RNDC and BBG since their respective early days in some states, the Company’s distributor agreements and new alignment will significantly expand the scope of these relationships. When the transition of territories is complete, the distribution of some or all of the Company’s winery brands will be handled by RNDC and BBG, respectively, in the following states:
Republic National Distributing Company:
Alaska, Georgia, Idaho, Indiana, Kentucky, Louisiana, Michigan, Mississippi, Montana, Nebraska, New Mexico, New York, North Dakota, Oklahoma, Oregon, South Dakota, Texas, Utah, Virginia, Washington, and Wyoming.
Breakthru Beverage Group:
Arizona, Colorado, District of Columbia, Florida, Illinois, Maryland, Minnesota, Nevada, Pennsylvania, South Carolina and Wisconsin.
“Duckhorn has worked with RNDC and BBG for decades, and each organization has always been an excellent distributor that brings a spirit of cooperation to achieving the Company’s goals,” said Pete Przybylinski, Executive Vice President, Chief Sales Officer of the Company. “As we have expanded our geographic commitment to RNDC and BBG, they have expanded their commitment to us. This will mean greater focus and investment in our winery brands, broader reach and deeper market penetration, and a shared focus on the Company’s growth that we believe will help us all to continue to outpace the market. We see many benefits of these enhanced relationships, not only for us and our distributors, but most importantly, for our retail customers and consumers.”
About The Duckhorn Portfolio, Inc.
The Duckhorn Portfolio is North America’s premier luxury wine company, with eleven wineries, ten state-of-the-art winemaking facilities, eight tasting rooms and over 2,200 coveted acres of vineyards spanning 38 Estate properties. Established in 1976, when vintners Dan and Margaret Duckhorn founded Napa Valley’s Duckhorn Vineyards, today, our portfolio features some of North America’s most revered wineries, including Duckhorn Vineyards, Decoy, Sonoma-Cutrer, Kosta Browne, Goldeneye, Paraduxx, Calera, Migration, Postmark, Canvasback and Greenwing. Sourcing grapes from our own Estate vineyards and fine growers in Napa Valley, Sonoma County, Anderson Valley, California’s North and Central coasts, Oregon and Washington State, we offer a curated and comprehensive portfolio of acclaimed luxury wines with price points ranging from $20 to $230 across more than 15 varietals and 39 appellations. Our wines are available throughout the United States, on five continents, and in more than 50 countries around the world.
About Republic National Distributing Company
As a top beverage alcohol distributor in the nation, RNDC’s national reach helps suppliers by building strategic relationships with on- and off-premise customers to elevate their brands and reach their target consumers. RNDC currently operates in the District of Columbia and 39 states across the United States.
About Breakthru Beverage Group
Breakthru Beverage Group is one of the leading alcohol wholesalers in the United States and the largest broker in Canada representing a full total beverage alcohol portfolio of spirits, wine and beer. Breakthru is committed to diversity, equity and inclusion and supports a wide range of notable organizations as well as local charitable initiatives across its North American footprint. Across all markets, Breakthru aligns a nimble and insightful approach to sales, marketing and operations. Family ownership is active in the business and committed to being stewards of heritage and champions of innovation.
Forward-Looking Statements
This press release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. In some situations, you can identify forward-looking statements by words such as “approximately,” “anticipate,” “assume,” “believe,” “contemplate,” “continue,” “could,” “estimate,” “expect,” “future,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “seek,” “should,” “target,” “will” and similar terms and phrases to identify forward-looking statements. These forward-looking statements include, among others, statements about the potential market opportunity resulting from the acquisition of the Sonoma-Cutrer and associated business strategy, the Company’s ability to better address certain markets, expand its capabilities and position in the industry and extend its product offerings to better serve our customers, as well as the potential synergies and other financial benefits derived by and financial impact to the Company from the acquisition. All of our forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those that we are expecting, including: risks associated with transactions generally; the failure to consummate or delay in consummating the transaction for other reasons; the risk that a condition to closing of the transaction may not be satisfied; the occurrence of any event, change or other circumstances that could give rise to the termination of the merger agreement; the outcome of any legal proceedings that may be instituted following announcement of the transaction; failure to retain key management and employees of Sonoma-Cutrer; issues or delays in the successful integration of Sonoma-Cutrer’s operations with those of the Company, including incurring or experiencing unanticipated costs and/or delays or difficulties; unfavorable reaction to the transaction by customers, competitors, suppliers and employees; unpredictability and severity of catastrophic events, including but not limited to acts of terrorism, war or hostilities, as well as management’s response to any of the aforementioned factors; and additional factors discussed in the Company’s filings with the SEC.
The forward-looking statements contained in this press release are based on management’s current plans, estimates and expectations in light of information currently available to the Company and are subject to uncertainty and changes in circumstances. There can be no assurance that future developments affecting the Company will be those that the Company has anticipated. Actual results may differ materially from these expectations due to changes in global, regional or local political, economic, business, competitive, market, regulatory and other factors, many of which are beyond our control, as well as the other factors described in Item 1A, “Risk Factors” in the Company’s 2023 10-K filed with the SEC on September 27, 2023, and the Company’s 10-Q for the quarter ended January 31, 2024, filed with the SEC on March 7, 2024, and other documents the Company may file with the SEC from time to time. Should one or more of these risks or uncertainties materialize or should any of our assumptions prove to be incorrect, our actual results may vary in material respects from what we may have expressed or implied by these forward-looking statements. Any forward-looking statement made by the Company speaks only as of the date on which it is made. All future written and oral forward-looking statements attributable to the Company or persons acting on the Company’s behalf are expressly qualified in their entirety by the previous statements. The Company undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by applicable securities laws.
Contacts
Investor Contact
Ben Avenia-Tapper
(707) 339-9232
[1]. Circana - Total US Food, Domestic $15+, Latest 52 weeks ending 05-12-24.
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