Chivas owner Pernod Ricard cheers growth in China and US

Analysts said the premium spirits industry is in 'reasonably fine fettle'. Picture: Mark Ralston/AFP/Getty Images

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Spirits giant Pernod Ricard has cheered a strong performance in the United States and a return to growth in China for a strong financial outturn in its latest trading year.

The group, whose Chivas Brothers subsidiary is Scotland’s second-biggest whisky business, said that global organic sales accelerated 3.6 per cent to €9.01 billion (£8.29bn).

Its major international brands saw sales growth of 4 per cent in the six months to end-June compared with a flat performance in the previous 12 months.

Eleven of Pernod Ricard’s 13 brands grew sales, including Ballantine’s and Jameson whiskies up 3 per cent and 15 per cent respectively, and The Glenlivet malt up 2 per cent. Chivas Regal, however, declined 3 per cent.

Elswehere, Absolut vodka sales were up 2 per cent and Martell cognac up 6 per cent. The key Americas region – which accounts for nearly a third of Pernod Ricard’s group sales – did well, with revenues up 7 per cent.

A main driver, said Pernod, was the US, which saw a 5 per cent lift in revenues. Jameson continues to shine, passing the three-million-case milestone in the Americas last year.

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Pernod’s profit on recurring operations climbed 3.3 per cent to €2.39bn, while net profit was up 13 per cent at €1.42bn, the results showed.

Alexandre Ricard, chairman and chief executive officer of Pernod, said: “These results demonstrate that the strategic direction the group adopted two years ago is delivering: growth is accelerating and diversifying through successful activation of our strategy.”

Profits in Asia/Rest of the World rose to €1bn from €982m; profits in the Americas lifted to €790m from €706m; and were ahead in Europe at €604m compared to €588m the year before.

Ricard pledged that in the financial year to the end of June 2018 the French company would continue to “implement our roadmap”, with digital being one of the prime areas of focus.

He added: “We are confident that we will continue improving our business performance. As a consequence, our guidance for full year 2018 is organic growth in profit from recurring operations of between 3 and 5 per cent.”

One analyst commented: “Pernod’s performance, following a similar story from arch-rival Diageo earlier this summer, seems to show the premium spirits industry is in reasonably fine fettle again after its difficulty with emerging markets for a few years.”

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