UK: Pernod Ricard bucks job cut trend
Nick Blair, Pernod's UK sales and marketing director for wine, told just-drinks this week that the firm is not currently eyeing job cuts as a reaction to slowing growth in the UK wine market.
"That's not an avenue we're looking to go down at the moment," Blair said during this week's annual Champagne tasting in London.
Two of Pernod's main rivals in the UK, Constellation Europe and E&J Gallo, have said they plan to cut up to 50 jobs each in the country, due to slowing sales as a result of duty tax rises and a deepening recession.
Nielsen figures obtained by the Wine & Spirit Trade Association (WSTA), and seen by just-drinks, show that year-on-year growth for wine sales by value was 4% for the month of March last year. In December, however, growth was down to around 0.5%.
Volumes showed a year-on-year decline of nearly 2% in December, compared to 3% growth in March. The WSTA has used the figures to argue against a tax rise on wine in last year's UK Budget, as well as further tax rises planned for this year.
Blair said that Pernod would look carefully at its UK volumes in the coming months. If better value can be achieved in other world markets, then some volume may be shifted out of the UK, he said.
Pernod's Jacob's Creek brand saw global volumes dip by 5% in the French drinks giant's first half, to the end of December. Net sales on an organic basis dipped by 1%. The group said that, in the UK, Jacob's Creek showed a "slight decline" in volume, but maintained market share in value.
The Montana brand also reported "modest decline" in the UK, Pernod said, despite a 3% rise in volumes and sales for Montana worldwide.
The firm said during its first half results conference, however, that Christmas trading in the UK had been strong for its wine brands.
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