Pernod Ricard’s Full-Year Sales Dip 1% To $12.9 Billion

Pernod Ricard saw sales slip 1% on an organic basis to €11.6 billion ($12.9b) in its fiscal year through June, as profit from recurring operations grew 1.5% organically to €3.1 billion ($3.4). On a reported basis, sales fell 4% and profit declined 7%. The company cited the normalization of the U.S. market and challenging conditions in China as impacting its results, but predicted a return to growth in its current fiscal year.

In the U.S., Pernod’s sales fell 9% for the year through June, with low single-digit growth in price/mix. The company says the market continues to normalize from the shocks of the pandemic, with its portfolio showing depletions value down 7% and underlying sell-out value down 4%, as retailers and distributors continue to scale back inventory. That’s expected to continue in the current quarter, with Pernod anticipating sales to decline in the three months through September.

From a brand perspective, Pernod says 3.9-million-case Jameson is holding share in the U.S., with its control state volume down 4% in the calendar year through July. Absolut’s core vodka was down at a similar rate, but its RTDs jumped 52% in control states through July, while Codigo 1530 Tequila grew 51% and Jameson RTDs rose nearly 30%. The nearly half-million-case Skrewball flavored whiskey label is slated to benefit from a new ad campaign that launched in recent months, Pernod added. Elsewhere, most of Pernod’s brands showed lower volumes in control states year-to-date.

To boost growth in the rising low- and no-alcohol segment, Pernod also announced this morning the acquisition of a minority stake in Almave non-alcoholic Tequila for an undisclosed sum. Almave was cofounded by Formula One world champion Lewis Hamilton.

Pernod chairman and CEO Alexandre Ricard said Almave is “truly exceptional in terms of quality, taste, and positioning. Agave is a highly sought-after category across the world. Having a non-alc proposition in our premium portfolio that pays full tribute to the craft and savoir-faire of its traditional distillation makes it a true gem.” He added that Pernod will look to scale the brand in key markets globally.

Further acquisitions could be on the way, with Pernod noting that it expects “continued active portfolio management, including value creating M&A.” In addition to onboarding newcomers like Almave, Pernod has culled non-core brands from its roster, including last monthselling its 10-million-case table wine business to Australian Wine Holdco, a consortium of institutional investors that owns Australian wine player Accolade Wines. —Daniel Marsteller

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