FRANCE: Rémy Cointreau FY profits fall on Metaxa charge
- Full-year net profits fall by 18% to EUR70.5m (US$103m)
- Operating profits slip by 14% to EUR120.5m
- Net sales rise by 12.4% to EUR907.8m
- Impairment charge on Metaxa hits profits, group hints at acquisitions
Rémy Cointreau hints that it may pursue acquisitions
Rémy Cointreau has seen strong demand for Cognac overshadowed by an impairment charge on its Metaxa brand in Greece during its fiscal full-year.
Net profits fell by 18% for the 12 months to the end of March, to EUR70.5m (US$103m), after the French drinks maker was forced to report a EUR45m impairment charge on its Metaxa brand. Metaxa's value has fallen sharply amid economic turmoil in its strongest market, Greece.
The charge also hit operating profits, which fell by 14% on the same period of last year, to EUR120.5m, Rémy Cointreau said today (9 June). However, as previously reported, China's thirst for high-end Cognac helped the group to increase company net sales by 12% for the year, to EUR907.8m.
Last week, Rémy Cointreau confirmed the sale of its Champagne business to France's Societe Europeenne de Participations Industrielles (EPI) for EUR412.2m. Rémy said today that the Champagne business reported sales up by 4.6% for its fiscal year, with operating profits excluding charges reaching EUR2.8m versus losses of EUR4m in the previous year.
Rémy also dropped the biggest hint yet that it may pursue takeovers following the Champagne sale.
While the group reiterated that the sale will help to "fund accelerated growth in major current markets, as well as in markets with strong potential for future growth", it added: "The group will also look closely at other growth opportunities should they present themselves."
Laetitia Delaye, head of beverage sector analysis at Kepler Capital Markets, said in a note last week that Rémy could make a move in Scotch or Bourbon. "We think the company has a war chest of EUR700m to EUR1bn to make such acquisition," she said.
For the company announcement, click here.
The penultimate part of this month's management briefing, which focuses on the Champagne category, sees Richard Woodard review the industry's main players....
Rémy Cointreau has appointed Mark Breene as senior vice president and chief marketing officer of its US business....
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