FRENCH drinks behemoth Pernod Ricard has cut its profit growth target for the current year following a sales slowdown in China.
However, the owner of Paisley-based Chivas Brothers said it remained confident over the medium- and long-term prospects for its second-largest market, where sales have been hit by the slowing economy and a crackdown on lavish spending by Chinese government officials.
Pernod, which counts Absolut vodka, Mumm champagne and The Glenlivet single malt among its key brands, now expects underlying operating profits to grow between 1 and 3 per cent for the year, compared with the 4 to 5 per cent growth it forecast in October.
The downgraded growth target came as the Paris-listed group reported a 7 per cent fall in first-half sales to €4.57 billion (£3.75bn), reflecting an 18 per cent slump in Chinese sales, but a tight rein on costs helped operating profits rise 2 per cent to €1.36bn.
Sales of The Glenlivet grew 10 per cent on the back of higher prices, but Chivas Regal fell 4 per cent.