By Dominique Vidalon
PARIS (Reuters) -Pernod Ricard on Thursday forecast its annual sales growth to remain dynamic after the company posted forecast-beating first-half profit and sales, helped by price hikes in the Chinese and the U.S. markets.
Pernod, which owns Martell cognac, Mumm champagne and Absolut vodka, said it planned further price hikes in the second half while it also banked on strong operations to help offset cost pressures amid stubborn inflation.
Pernod, the world’s second-biggest spirits group behind Diageo, reported profit from current operations in the six months ended Dec. 31 at 2.423 billion euros ($2.6 billion), an organic rise of 12% above analysts’ expectations for an 8.2% increase.
Sales at Pernod – whose rivals include Diageo and Remy Cointreau – totalled 7.116 billion euros in the first half, representing an organic rise of 12%, compared with analysts’ expectations for a 9.7% increase.
Pernod Ricard’s fiscal year started on July 1.
The strong first-half period reflected a 5% rise in sales in the United States, Pernod’s top market, with growth driven by strong hikes across its portfolio and new prices planned for the second half.
In China, first-half sales growth stood at 4%, reflecting a strong first quarter with solid demand for Martell cognac during the Mid-Autumn festival but a soft second quarter due to COVID-19 restrictions.
Pernod Ricard, however, said it remained confident on its outlook for China as the country is emerging from its zero-COVID policy and lifting restrictions.
Sales grew 17% in India, reflecting mid-single-digit price hike, notably for Seagram’s whiskies and strong demand for its international brands, notably Jameson, the Scotch portfolio and Absolut vodka.
($1 = 0.9342 euros)
(Reporting by Dominique Vidalon; Editing by Sudip Kar-Gupta and Sherry Jacob-Phillips)
