Pernod Ricard Q1 sales beat forecasts with strong demand in China and U.S.
- Q1 sales 2.72 bln euros, up 20% l-f-l vs est. 15.7%
- China sales up 22%, U.S. sales up 9%
- Expects good sales growth through year though moderating vs Q1
PARIS, Oct 21 (Reuters) – French spirits maker Pernod Ricard (PERP.PA) said it expected sales growth to continue through its 2022 fiscal year, although it could moderate a touch, after strong demand in China, the United States and India helped it deliver a forecast-beating 20% growth in the first quarter.
Pernod, the world’s second-biggest spirits group behind Diageo (DGE.L), said consumption by people staying at home remained resilient, while the re-opening of bars and restaurants also lent support. Travel retail was still subdued although the company benefited in the quarter from a low comparison basis.
Pernod Ricard’s fiscal year started on July 1.
“We expect good sales growth to continue through FY22, albeit moderating versus Q1. We will continue to implement our strategy, notably accelerating our digital transformation and re-investing to seize present and future growth opportunities,” Chairman and Chief Executive Officer Alexandre Ricard said in a statement.
In fiscal 2022, Pernod Ricard will invest significantly in advertising and promotion (A&P) and structure costs and implement half of its already announced 500 million euros share buyback programme in the first half.
For the first quarter ended Sept. 30, Pernod – which owns Martell cognac, Mumm champagne and Absolut vodka – reported sales of 2.718 billion euros ($3.17 billion), a like-for-like rise of 20%. The market had expected a 15.7% sales rise.
The strong start to the year reflected in a 9% sales jump in the United States, Pernod Ricard’s top market, with good replenishment ahead of the festive season and a rebound in demand for Jameson Irish whiskey as bars and restaurants reopened after COVID restrictions were eased.
In China, sales jumped 22%, driven by demand during the Mid-Autumn Festival and Martell cognac price hikes. China contributes around 9% to Pernod’s sales and is its second-largest market.
Global travel retail sales rose 55% year-on-year, returning to growth in all regions and benefiting from a very favourable comparison basis.
($1 = 0.8583 euros)
Reporting by Dominique Vidalon; Editing by Subhranshu Sahu
Our Standards: The Thomson Reuters Trust Principles.