FRANCE: Pernod credits “emerging markets” for Q1 growth
The French drinks company said today (30 October) that sales rose to EUR1,557m (US$2,241m), up from EUR1,457m for the same time the previous year, helped by "strong sales growth in emerging countries".
The company said that its spirits business recorded growth of 13.4%, on the back of a good performance by all Pernod's geographic regions. The wines business, meanwhile, improved by 3.3%.
Pernod credited its strong performance to the development of luxury brands driving growth, with growth of its premium brands at 23%. The growth by its 15 strategic brands reached 9% in volume and 16% in value.
Pernod chairman Patrick Ricard said: "First quarter performance was excellent and again illustrated the success of our premiumisation strategy and development in emerging countries."
In a statement, the French-based drinks groups said that all its geographic regions contributed to organic growth. Asia/Rest of World reported sales of EUR498m, up 12.4%.
In particular China showed up well, posting net sales organic growth of 30%, in particular due to its Martell and Ballantine's brands. India also recorded strong growth due to its Indian whisky portfolio, including Royal Stag, Imperial Blue and Blenders Pride, and to the success of imported whisky brands, especially Chivas Regal and Ballantine's.
The Americas meanwhile registered sales of EUR393m, a fall of 3.1% on last year, although organic growth was at 11%. In North America, Jameson, Malibu, The Glenlivet and Wild Turkey continued to expand rapidly in the US. Chivas Regal sales increased slightly, whereas Martell and Mumm declined following price increases. Kahlúa and Beefeater sales decreased again, the company said.
In Europe sales reached EUR508m, up 10.9%, or 12% in organic terms.
Encouragingly for Pernod Ricard, Europe recorded a sharp acceleration, especially for the 15 strategic brands whose sales increased by 16%. Sales growth was enhanced by favourable comparison bases, the statement said.
Sales increased in most European countries but Western European countries experienced the strongest growth overall.
In its home market of France first quarter sales held up well, helped by most whisky brands, in particular premium brands Chivas Regal, Aberlour and The Glenlivet), partly due to strong promotional activities. Aniseed product sales declined, due to bad weather in the summer and in spite of a marked recovery in September.
Ricard added: "These very good results enable the confirmation, in current market conditions and on a like-for-like basis, of guidance of strong growth in sales and operating profit from ordinary activities for Pernod Ricard in 2007/08."
A guidance figure for organic growth in operating profit from ordinary activities will be released on 7 November at Pernod's AGM.
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