Robust Performance, Pernod Ricard Steering Through Spirits Market Normalization
Regulatory News:
Pernod Ricard (Paris:RI):
Press Release – Paris, 15 February 2024
Alexandre Ricard, Chairman and Chief Executive Officer, stated,
“We delivered a robust performance in the first half of the year, as we confidently steer Pernod Ricard through the normalization of the spirits market, following two years of outstanding growth.
We achieved strong Gross Margin expansion on the back of substantial pricing actions, thanks to the power of our premium portfolio. With a diversified footprint spanning mature and emerging regions and a broad presence across spirits categories, we are able to weather volatility and continue to gain share in many markets.
I am convinced that our sound strategy, together with the dedication, agility, and exceptional engagement of all our teams around the world, will enable us to deliver our ambitions.”
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SALES
H1 FY24 Sales totalled €6,590m, in organic decline of -3% (-7% reported), with a negative FX impact of €(576)m mainly linked to the US dollar, Turkish lira, Chinese yuan and Argentinian peso, with broadly half of it offset by a positive perimeter impact of +€264m.
By regions:
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Americas -7%:
- USA -7%:
- Consumer demand resilient as spirits market continues to normalize
- Net Sales -7% with value depletions c. -6%, due to high comparison basis and compounded by inventory adjustments (c. 3pts)
- Share gains on Jameson Original, Malibu, Kahlua, The Glenlivet, Código and Jefferson’s
- Significant investments behind our brands with A&P at c. 20% of Net Sales
- Improvement expected in H2, with strong brand activations, despite further inventory adjustments
- Canada Sales decline with adverse phasing last year
- LATAM high comparison basis in Brazil and Mexico, improvement expected in H2 and easing comparables.
- USA -7%:
-
Asia-RoW +1%:
- China -9%:
- Softened consumer demand in a challenging macro environment
- Dynamism of international premium spirits notably strong growth of Absolut, Jameson, tequila and gin
- Martell Noblige resilient, Premium and Super premium whiskies performance including Chivas Regal in growth
- Cautious trade sentiment ahead of CNY
- India +4%:
- Strong market demand for spirits
- Acceleration in Q2 Net Sales against easing comparables
- Strategic International Brands in very strong growth notably Jameson, Absolut and The Glenlivet
- Good growth on Seagram’s whiskies
- Strong growth expected in H2
- Good growth in Japan, Taiwan market, Travel Retail and Australia. Africa Middle East in very sharp growth driven by Turkey acceleration and Nigeria.
- China -9%:
-
Europe -4%:
- Net Sales excluding Russia +1% with overall resilience in the region. Strong growth2 in Central and Eastern Europe led by Poland. Resilience in Western Europe led by Germany and offsetting softer performance in France, UK, and normalization in Spain. Gaining share in premium+ category in many markets.
-
Global Travel Retail -3%:
- Ongoing normalization of passenger traffic, now at c. 95% vs pre-covid, with Chinese travel recovery lagging
- Net Sales impacted by phasing in H1 with strong growth expected in H2
By categories: