Pernod Ricard benefits from emerging market exposure

Pernod Ricard benefits from emerging market exposure

Pernod Ricard's operating profits rose by more than expected in the group's most recent fiscal year, as emerging markets drove a recovery in like-for-like sales in the second six months.

Profits from recurring operations are expected to have risen by 4% for the year to the end of June, compared to the prior year, Pernod said in a full-year trading update today (22 July).

The Absolut vodka and Beefeater gin producer previously forecast a 3% rise.

Its higher guidance will lift spirits in the drinks sector, although the firm's sales performance was mixed for the year.
Like-for-like sales, excluding currency losses and disposals, rose by 2% for the year, Pernod said. However, reported sales, with currency accounted for, slipped by 2% for the 12 months.

Buoyancy in Latin America and premium Cognac sales in China helped Pernod to a strong recovery in the second half of the year.

But, while the company reported "a gradual recovery in consumer spending in mature markets", it added that sales continued to fall in Western Europe, and particularly in Spain, UK and Greece, during the second half.

The US, Eastern Europe and travel retail have shown some improvements, the firm said.