Champagne removes fizz from Pernod results

Pernod Ricard today released its results for the year to the end of June 2010, revealing an increase in organic growth sales, particularly for spirits but a slight fall in Champagne sales.

Full year sales for the group reached €7 billion, excluding tax and duties. This meant that while organic growth sales were up 2%, the group recorded a moderate decline of 2% overall.

Pernod said that the disposal of Wild Turkey, Tia Maria and Bisquit and the end of its Stolichnaya distribution deal had contributed to a “negative group structure effect”.

An encouraging performance within the Pernod’s remaining spirits portfolio saw Martell Cognac and Jameson whiskey achieve growth of 12% apiece.

The Glenlivet whisky, Absolut vodka and Chivas whisky also showed growth of 7%, 6% and 5% respectively.

Wine and Champagne sales were not so positive. Mumm reported a 7% decline, which the group attributed to the struggling French on-trade, and Jacob’s Creek also saw a 5% fall in sales, which Pernod said “reflected our premiumisation strategy for the brand.”

The group’s other Champagne brand, Perrier-Jouët showed no change in its sales figures.

Overall, the group’s share of the net profit was €951 million, a 1% increase on last year and a debt reduction of €1bn was also achieved.

While the French, Spanish, UK and Irish markets were sluggish, the rest of the world, Asia in particular, showed strong growth with even a slight rise in US consumer spending.

Overall, the board of directors considered the growth in earnings and its advertising and promotion expenditure “satisfactory”.

Pierre Pringuet, CEO of Pernod Ricard, said: “Our performance over the 2009/10 financial year was a strong and sound one. Our priorities for the 2010/11 financial year remain the development of our premium strategic brands, a continuing strong marketing investment level, and the reduction in group debt.”

Rupert Millar, 02.09.10