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October 25, 2022

Rémy Cointreau beats Q2 expectations, outlook remains “tinged with caution”

Shares in the Paris-headquartered group fell by nearly 7% following the release of its second-quarter figures.

By James Beeson

Better-than-expected second-quarter sales failed to stop a 6% slide in Rémy Cointreau shares after the French wine-and-spirits maker predicted a normalisation of consumption habits following two “outstanding” years of sales.  

The Cointreau brand owner posted a 16.2% rise in sales in the three months to the end of September, citing a “sharp market rally” in China, as Mid-Autumn festival consumers showed a thirst for its Cognac brands. Revenues came in at EUR457.2m (US$450.5m) beating analysts’ expectations for 14.3% growth but a cautious tone over its second-half outlook spooked investors early on Tuesday morning (25 October).

Shares in the Paris-headquartered group fell by nearly 7% following the release of its second-quarter figures, before recovering slightly to sit 6% lower than at the start of trading as of 10:30 BST.

The Rémy Martin Cognac-brand owner maintained its full-year 2023 guidance, despite its half-year sales revenue sitting more than 21% ahead of 2022’s figures on an organic basis. In its most recent full-year results, Rémy Cointreau’s sales topped EUR1.31bn (US$1.4bn), up 27.3% on the year previous.

“Rémy Cointreau Q2 fiscal 2023 sales were solid… but the H2 outlook is tinged with caution,” said analysts at AllianceBernstein in a note to clients. “The numbers themselves were solid but we think that investors could be unsettled by the relatively less bullish language around H2 trends in the guidance and the near-term weakness in US value depletions trends… which seem to have accelerated further in Q2.”

Rémy Cointreau said: “The group intends to continue to gain market share value in the exceptional spirits sector. It expects another year of strong organic growth, including normalisation of consumption trends in the second half on the heels of two outstanding years.

“More specifically, as life ‘returns to normal’ in most regions, overall consumption from H2 on is likely to settle in at ‘new normal’ levels that are well above those observed in 2019/20. At the same time, growth should be tempered by high bases of comparison.”

Last week, the group announced the launch of Maison Psyché, its first foray into the world of perfume. The new fragrance house aims to bring the expertise of the perfumery and spirits worlds together to “explore uncharted horizons”.

Eric Vallat, CEO of Rémy Cointreau, said the launch was “a natural extension” of the spirits maker’s activities.

“It is based on the special blending and ageing expertise specific to the world of spirits to elevate the finest raw materials from perfumery and create innovative fragrances,” he said.

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