GLOBAL: Pernod Ricard toasts buoyant H1, despite "soft" Europe
- Half-year net profits up by 20% to EUR820m (US$1.07bn)
- Net sales rise by 8% to EUR4.6bn
- Operating profits from recurring operations up by 14% to EUR1.38bn
- Strong underlying performance boosted by Chinese New Year, French stockpiling
Pernod Ricard has lifted its full-year profits guidance after emerging markets drove the group to strong sales and profits growth in its first-half.
Pernod Ricard said today (16 February) that net sales for the six months to the end of December reached EUR4.6bn (US$6bn). Emerging markets across Asia continued to drive growth, with Jameson leading a 5% increase in organic net sales in the US.
Sales were also inflated by extra demand for premium Cognac ahead of Chinese New Year. A weak performance in Europe, meanwhile, was flattered by a mass distributor buy-in of Ricard pastis in France, ahead of the January's 14% increase in excise tax on spirits. Excluding France, sales in Western Europe fell by 2%.
Pernod translated its sales performance in to a 14% increase in operating profits from recurring operations, to EUR1.38bn. Net sales increased by 20% to EUR820m.
This prompted group CEO Pierre Pringuet to raise the full-year forecast for growth in organic profits from recurring operations "close to 8%". This is up two percentage points from guidance given after the first quarter.
Pringuet said that the results "demonstrate the strength of our business model", highlighting the French group's premium focus and wholly-owned global distribution network. He also flagged Pernod's progress on reducing debt, with net debt to EBITDA expected to reach a ratio of 3.9 by the end of its current fiscal year. The ratio was 4.4 last year.
For the company's announcement, click here.
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