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Remy Cointreau upbeat on H2 as first-quarter sales beat expectations - results data & comment

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  • Fiscal first-quarter sales fall 33.2% to EUR150.1m (US$171.7m)
  • Remy Martin Cognac portfolio slides 39.2%
  • Brand Cointreau enjoys "remarkable" three months
  • US and China to drive "strong recovery" in H2

Remy Cointreau has soundly beaten its forecasts for the fiscal first quarter, with sales declining at a much slower rate than initially expected.

In late-April, the group predicted a slump in sales from the three months to the end of June of between 50% and 55%. Two months later, Remy revised its top-line expectations upwards, to -45%.

Earlier today, however, the company reported a 33.2% slide in three-month sales. Remy credited the performance to the "resilient consumption of spirits in the US and the UK" over the period.

While sales were down in virtually all of the group's markets, the UK and Russia posted growth in the three months. The US, meanwhile, was in "only moderate decline", Remy said.

Remy Cointreau First-Quarter Fiscal-2021 - Sales by Business - reported

Source: Company results

The 'House of Remy Martin' division saw sales decline by 39.2% although demand for the Cognac brand has started to improve again since May. As for the rest of Remy's owned-brands, grouped in the 'liqueurs & spirits' reporting unit, combined sales slid 17%, with Cointreau benefitting from at-home cocktail consumption. Indeed, the liqueur saw its off-premise sales make up for the absence of the on-premise channel, which was shut down for part of the three-month period due to COVID-related lockdown measures. 

Remy Cointreau Fiscal-2021 - Sales versus 2020 - reported

Source: Company results

Looking ahead to the rest of the fiscal full-year - to the end of March 2021 - Remy expressed confidence in "its ability to emerge stronger from the crisis". Sales are expected to be in moderate decline in the current quarter, with a "strong recovery" forecast in the second half of the year.

just-drinks thinks...

Remy Cointreau may earn some plaudits for today's better-than-expected sales results from Q1, but a top-line decline of one-third can hardly be described as 'good'.

What's more likely to be the case here is that the group erred massively on the side of caution when preparing us earlier this year for its sales slide in the three months to the end of June. When Remy issued its initial Q1 sales forecast in April, the coronavirus gloom was all around us.

Still, better to impress than depress - and, what better way to do that than to set a bleak scene in the first place?

To read Remy Cointreau's' official results announcement for Q1 fiscal-2021, click here.

Remy Cointreau Performance Trends 2016-2020 - results data


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