Scotch whisky sales drive profits at Pernod Ricard

The Glenlivet and other whiskies helped annual profits rise 9 per cent. Picture: Sandy Young
The Glenlivet and other whiskies helped annual profits rise 9 per cent. Picture: Sandy Young
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CHIVAS Brothers owner Pernod Ricard yesterday revealed a robust sales performance by The Glenlivet and other whiskies helped annual profits rise 9 per cent despite a “challenging and volatile” trading environment.

It came as Scotland’s second-biggest whisky producer said that it was seeing some recovery in China, where Western deluxe spirits sales have suffered in the past two years from a slowdown in the pace of economic growth.

The latter was exacerbated in recent times by a Chinese government crackdown on gift exchanges with its officials.

Pernod Ricard said that sales in China fell 2 per cent in the 12 months to end-June, marking a dramatic recovery compared with the 23 per cent slump it suffered the previous year, when the company was also hit by a slowdown in other Far Eastern markets.

Overall profits rose to €2.23 billion (£1.6bn) from €2.06bn last time on reported sales up 8 per cent at €8.55bn. However, the headline figures were flattered by favourable exchange rates, particularly the US dollar, with underlying sales and profits up 2 per cent.

“In terms of categories, growth was driven by whiskies,” Pernod said. The Glenlivet’s sales rose 11 per cent, Irish whisky Jameson was 10 per cent ahead and Ballantine’s whisky was up 3 per cent.

Mumm and Perrier-Jouet champagnes were also strong performers, with sales up 7 and 9 per cent respectively.

The world’s second-biggest spirits company behind Britain’s Diageo handed investors a 10 per cent hike in the full-year dividend to €1.80 as it hailed its performance as “solid” in testing conditions.

Alexandre Ricard, chairman and chief executive of Pernod, said: “Our strategy has remained consistent and is delivering results.

“For full-year 2015-16, despite a challenging and volatile macroeconomic environment, we aim to continue gradually improving our business performance.”

The group said that, in the past year, it had made market share gains in most key markets. There was 2 per cent sales growth in the Americas, with the US stable for the full year and improving in the second trading half.

European sales were stable, with a return to growth in Spain, up 2 per cent. But difficulties remained, Pernod said, in eastern Europe and the company’s travel retail division.

Meanwhile, Pernod’s key local brands, as opposed to its “Top 14” products, did well, with sales up 5 per cent.

• North British Distillery, which produces grain whiskies for the likes of Cutty Sark and Famous Grouse, has appointed Alan Kilpatrick as the 11th managing director in the firm’s 130-year history. He succeeds David Rae, who is retiring after holding the post for the past 20 years.

Kilpatrick was most recently strategy director for Baxters Food Group. He was previously managing director for Scotland at sausage skin maker Devro.