Strong sales of Jameson Whiskey helps drive revenues for spirits maker Pernod Ricard

Pernod Ricard expects sales growth to moderate after strong first quarter

Pernod reported a 20 per cent rise in first quarter sales. Photograph: Aidan Cawley/Bloomberg

Pernod reported a 20 per cent rise in first quarter sales. Photograph: Aidan Cawley/Bloomberg

 

Continued strong sales of Jameson whiskey helped lift revenues for parent Pernod Ricard in its first quarter.

The spirits maker Pernod Ricard warned however that solid sales growth could moderate in over the year, after strong demand in China, the United States, India and Europe helped it post above-forecast sales in the first three months.

Pernod – which also owns Martell cognac, Mumm champagne and Absolut vodka – reported a 20 per cent rise in like-for-like sales to €2.7 billion in the three months to September 30th, above market expectations for a 15.7 per cent rise.

The world’s second-biggest spirits group said consumption by people staying at home remained resilient, while the reopening of bars and restaurants as coronavirus restrictions eased also helped, notably in Europe.

Expectations

Travel retail was still subdued although the company benefited in the quarter from a low comparison base.

Pernod Ricard’s fiscal year started on July 1st.

When asked if he was comfortable with average analyst expectations of 9.7 per cent sales growth for the full year, chairman and chief executive Alexandre Ricard told Reuters “we give a qualitative guidance”.

“We are confident but we need to go through Christmas and the Chinese New Year (to have more visibility),” he said.

Pernod expected “good sales growth to continue through the year”, he said, adding that the first quarter had benefited from a low comparison base a year ago, when pandemic curbs had hit businesses in many countries.

That comparison base would progressively become less favourable as the year progressed, Mr Ricard added.

“The comparison basis will get more complicated, the longer we go on.”

The strong start to the year reflected a 9 per cent 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.

Concerns

Supply chain concerns ranging from difficulties to find containers or truck drivers led some clients in the United States to stock up ahead of the holiday season, Ricard said.

In China, sales jumped 22 per cent, driven by demand during the Mid-Autumn Festival and Martell cognac price hikes.

“The Mid-Autumn Festival went well and our inventory level is healthy,” Mr Ricard said.

Europe also had a strong start, with sales rising 22 per cent as consumers headed to bars and restaurants amid easing Covid restrictions.

Global travel retail sales rose 55 per cent year-on-year, returning to growth in all regions and benefiting from a very favourable comparison base. – Reuters