Shares in Rémy Cointreau rose today (30 April) after the French spirits group booked its annual sales and issued guidance but analysts expressed caution about the outlook for the company.
The Cognac and whisky maker posted an 18% decline in full-year sales on an organic basis to €984.6m ($1.12bn). In January, the Rémy Martin Cognac maker had forecast it expected to see its organic sales come in “at the lower end of the guidance range (close to 18%)”.
Go deeper with GlobalData
Rémy Cointreau is set to report its full figures for the year in June but today confirmed its 2024-25 “current operating margin” target of between 21% and 22% on an organic basis.
The Bruichladdich Scotch whisky owner described 2024-25 as “a year of transition” and said its new 2025-26 fiscal period “will mark a resumption of the trajectory set for 2029-30”.
During that time-frame, the company has set targets of “high single-digit annual growth in sales on average and on an organic basis”, as well as “a gradual organic improvement in current operating profit margin”.
Shares in Rémy Cointreau, which are down more than 17% year so far this year, were up 2.2% on the day at €47.40 at 13:54 CET.
US Tariffs are shifting - will you react or anticipate?
Don’t let policy changes catch you off guard. Stay proactive with real-time data and expert analysis.
By GlobalDataBernstein analyst Trevor Stirling described Rémy Cointreau’s fourth-quarter sales results as “a real mixed bag”.
The group’s Cognac business, which makes up the majority of revenue, saw its sales drop 32.8% on an organic basis during the quarter, hit by the industry-wide block on sales through China’s duty-free channel.
In the Americas, Rémy Cointreau’s Cognac sales “rebounded sharply”, particularly in the US, the company said. However, Stirling noted the recovery in the US was “on an easy comp base”. He added: “Nielsen data – which is only part of the picture – is still soft.”
Rémy Cointreau’s liqueurs and spirits division saw its sales grow 16.1% in the fourth quarter, beating analyst expectations. The company pointed to a “significant rise in sales” in the Americas and notably the US.
Stirling, reflecting on the uncertainty around the tariffs China may place on brandy and the US may impose on all EU products, said: “We think it’s too early to call the bottom. If China and the EU don’t strike a deal, then Cognac could be permanently blocked from duty-free. And there is still the threat of 20% tariffs on EU imports into the USA. Net-net, positive news on underlying demand but the threat of incremental hits from politics is still very real.”
Barclays analyst Laurence Whyatt said Rémy Cointreau’s outlook was “ambitious”.
“Rémy Cointreau has made some optimistic statements. Firstly, that the US market is rebounding sharply. It is unclear how much of an impact tariff anticipation was,” he said. “Secondly, despite mentioning the current tariff outlook from both China and the USA, the company believes it can both grow the top line by HSD and margins in FY26-30. Of course, as we have mentioned, we are cognisant of the upside risks if the China tariffs are not confirmed in the coming months. But it remains a risk. US tariffs appear more likely in one form or another, and there is risk of the current 10% tariff on EU products escalating.”
