Pernod Ricard Profit Rises on Whiskey, Champagne Sales
February 11 2016 - 3:10AM
Dow Jones News
PARIS—French liquor group Pernod Ricard SA said Thursday its
first-half profit for the fiscal 2016 year rose 9% on strong sales
in the U.S. and some emerging markets helped by the euro's weakness
against the dollar.
The owner of Absolut vodka and Jameson whiskey said profit for
the six-month period ending Dec. 31, rose to €909 million euros
($1.03 billion), up from €834 million in year-earlier period.
The company's profit from recurring operations, the measuring
stick that analysts and the company often use, rose 6% during the
half-year period to €1.44 billion from €1.36 billion in the same
period in fiscal 2015.
Second-quarter revenue at the family-controlled group, the
world's no. 2 drinks conglomerate after Diageo PLC, rose 6% as
strong sales of Jameson whiskey and Perrier-Jouet champagne made up
for declining sales of Absolut and Chivas Regal Scotch whisky.
Organic revenue growth, which strips out the favorable effect of
the low euro, was at 4% for the quarter, the company said.
The modest growth at Pernod highlights the shifting dynamics
that are driving its spirits business: The continued rise of the
U.S. and the Jameson whiskey brand, compensating for the formerly
fast-growing Chinese market and the flagship Absolut vodka label,
which continue to drag.
Organic sales growth for Jameson was 11% while Perrier-Jouë t
posted 10% organic growth during the quarter. Absolut declined 3%
and Chivas Regal slipped 2%.
Sales in its Americas region, dominated by the U.S. market, rose
4% in the quarter, while its operations in Asia and the rest of the
world increased 14%. Those two areas made up for a 2% decline in
Pernod's home region of Europe.
Pernod said demand in China remained weak. The country, which
was formerly a major driver of growth, saw its sales decline 2%
over the six-month period. However, when adjusting for the fact
that Lunar New Year came earlier this year, sales in China actually
slid 8%. Sales in China have declined steadily since a government
anticorruption campaign took bite in 2013 and discouraged spending
on luxuries such as expensive liquor.
Despite the weaker Chinese market, the company confirmed its
forecast for 1% to 3% growth in profit from its recurring
operations for the full fiscal year.
(END) Dow Jones Newswires
February 11, 2016 02:55 ET (07:55 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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