LONDON — As a global recession looms, what better way to cope than to eat, drink and be merry? Even as consumers face soaring energy costs, rising food prices and higher mortgages or rent, it seems clear they’re not prepared to forgo many of life’s little treats. Alcohol, cigarette and candy makers are all reporting healthy sales amid the gloom.
“I would never give it up, not unless I was dying of alcohol poisoning or something,” said Kelly Piggeln, a 62-year-old retired nanny, as she indulged in her favorite two vices of a cigarette and a glass of wine on the patio of a London bar.
So-called sin stocks, such as gambling and liquor, are usually a safe bet in hard times. While shares in some of those companies have fallen along with stock exchanges this year, lots are still seeing strong revenues and sales.
“It’s inelastic demand, as far as many of these stocks are concerned,” said Hargreaves Lansdown analyst Keith Bowman, using the economists’ term for consumption that is not deterred by higher prices. “So far, there’s signs that they are holding up, although there’s still concern that these industries will see some impact.”
Among the winners: Anheuser-Busch, the biggest U.S. brewer, turned a profit in the most recent quarter despite fears that rising costs for raw materials would cut into its bottom line.
