Analysis - Remy Cointreau "reassuring" on Cognac growth
Some analysts fear a Cognac slowdown
In full-year results released today (18 April), Remy admitted “more modest” Cognac volumes growth but continued to post high double-digit sales growth for its Remy Martin brand, up by 21.5% year-on-year.
UBS analysts said in a note that that overall organic sales were better than expected. Cointreau sales in the US helped the company's liqueurs and spirits category outpace market predictions, it flagged.
Remy's management was “reassuring” about China's Cognac sector, UBS said, which some analysts believe is slowing down after years of strong growth.
“(Management) sees no negative mix issue in the Cognac portfolio, and pricing continues, especially at the higher end,” UBS said.
However, Pernod Ricard, whose Martell Cognac brand has been performing well in China in recent years, admitted last month that a government crackdown on inter-governmental gift-giving and banquets was part of the reason for its “soft” performance in China in the calendar year so far.
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