Pernod Ricard expecting 'broadly stable' full year despite ongoing sales dip - results data

Sales from three months to end of December – Pernod Ricard’s fiscal Q2 – decrease by 4% to EUR3.55bn (US$3.8bn)
Six-month sales down 3% at EUR6.59bn
US “market normalisation” continues, top line falls 7%
China dips 9% as Europe slips by 4%

Following the financial first quarter’s sales decline of 2%, the Chivas brand owner today reported a -4% performance in fiscal Q2, to the end of December. The resultant 3% decrease in sales for the six-month period was countered by the forecast of “broadly stable … sales in (the) full year”, to the end of June.

In the quarter to the end of 2023, two of the group’s three reporting regions registered decreases, with the ‘Americas’ and ‘Europe’ coming in down 5% and 8%, respectively. ‘Asia/Rest of World’ inched up by 1%.

Pernod Ricard focused its commentary on the half year, describing sales as “robust” and highlighting the “outstanding growth” reported in fiscals 2022 and 2023. Indeed, references of “markets normalising” appeared both in the results announcement and follow-up presentation.

In China and the US, framed as being “must-win markets” by the company, six-month sales were down by mid-to-high single digits – -9% and -7%, respectively. In the global travel retail channel, meanwhile, the 3% dip, which occurred despite high single-digit price rises, was blamed on a lag in Chinese travel and “ongoing normalisation of passenger traffic”.

On a brands basis, all 13 of Pernod Ricard’s major international marks posted volumes decreases. The figures for Havana Club, one of only three of the headline brands to be up in value terms, were impressive, suggesting a premiumisation opportunity for rum going forward.

Other brands to warrant namechecks included Irish whiskey Jameson for its international performance and Absolut vodka, which posted “dynamic growth” in ‘Asia/Rest of World’ as well as in ‘Europe’.

“We delivered a robust performance in the first half of the year, as we … steer Pernod Ricard through the normalisation of the spirits market,” said CEO Alex Ricard. “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.”

Ricard and the wider group will have taken little comfort from rival Diageo’s healthier sales performance in the same half-year: Late last month, the Johnnie Walker brand owner delivered a flat top-line performance – -0.6% – as its ‘North America’ division was down by 2% year-on-year, compared to -7% for Pernod Ricard’s ‘Americas’ unit.