Rémy closes door on nightmare year

5th June, 2014 by Gabriel Stone

Rémy Cointreau has predicted a return to growth next year, despite seeing net profits slide by 46.9% and sales fall by 13.5% in its final 2013/14 results.

RemyIt marks the end of a difficult year for the drinks group, whose dominance in the Cognac market left it badly exposed to the recent slowdown in China. The start of 2014 saw the resignation of Rémy Cointreau CEO Frédéric Pflanz just three months into the role, followed by the departure just a couple of weeks later of Rémy Martin CEO Patrick Piana.

Only last week the group was subject to takeover rumours by Brown-Forman, which caused a 3% uplift in its share price, although this particular deal is understood to have been rejected.

Total sales for the Rémy Cointreau for its financial year to the end of March 2014 reached €1,031.6 million, compared with €1,193.3m in 2012/13, while net profits dropped to €80.2m from €151.5m a year ago.

The company attributed this decline primarily to the decision to reduce inventory levels in its Chinese distribution networks in reaction to falling consumption. However, it highlighted a “strong momentum” in the US, with further growth in European markets.

Within its core brand portfolio, a good performance in other markets was not enough to stop China from pushing Rémy Martin’s sales down by 20.8% to €551.2m, with operating profit falling by 43.9%.

It was a more positive story for Rémy Cointreau’s other liqueur and spirits brands, which together posted sales growth of 3.3%. Although an “adjustment” to US shipments led to a “slight decline” for Cointreau, there was double digit growth for both Metaxa and Mount Gay.

Looking ahead, the group pointed to an “uncertain” environment, highlighting ongoing changes in China’s spirits market and “a weak macro-economy in Western Europe”, but insisted it was entering the next financial year “with confidence”.

In particular, Rémy Cointreau noted: “thanks to its management policies – prudent on inventories and resolute on pricing, the group can set an objective of achieving organic growth in sales and current operating profit in 2014/15.”

Emphasising a focus on “the upmarket positioning of its brands”, Rémy Cointreau confirmed a plan to “resolutely pursue its marketing investment, its creative innovations and the expansion of its distribution network, whilst maintaining strict cost control.

“All these elements make the group confident in its ability to return to profitable and steady growth in the future.”

One Response to “Rémy closes door on nightmare year”

  1. Rafael Rosello. Hall says:

    Raf. Rosello/Hall.
    I presume now no is time for drink hard liquors and premier wines especially Bordeaux and hight prices..

Leave a Reply

Your email address will not be published. Required fields are marked *

Please note that comments are subject to our posting guidelines in accordance with the Defamation Act 2013. Posts containing swear words, discrimination, offensive language and libellous or defamatory comments will not be approved.

Subscribe to our newsletters

2 x Buying Assistants

Berry Bros. & Rudd
Battersea and Basingstoke, UK

Temporary Christmas Sales Support - Wines & Spirits

Harrods
Knighsbridge, London, UK

Head of Wholesale

Hispamerchants Ltd
London, UK

Sales Manager

Hispamerchants Ltd
London, UK

National Sales Manager

Maverick Drinks
Field based, UK

Regional Sales Executive

EWGA
Gloucestershire, UK

Senior Content Writer

Rude Wines
Ledbury, UK

Events and Trips Manager

Berkmann Wine Cellars
London, UK

The World Bulk Wine Exhibition

Amsterdam,Netherlands
20th Nov 2017

The Drinks Business Green Awards 2017

London,United Kingdom
20th Nov 2017

The Global Spirits Masters Lunch

London,United Kingdom
1st Dec 2017
Click to view more

Green Awards 2017

Deadline : 25th October 2017

The Global Riesling Masters 2017

Deadline : 30th October 2017

Click to view more

Champagne Masters 2017

The only Champagne blind tasting in the UK, the competition will reward the best wines in the following categories:

The Global Rosé Masters 2017

With wines from the palest of pink to almost ruby red, bone dry to almost cloyingly sweet, reductively handled to barrel-aged, as well as gently spritzy to fully sparkling.

Click to view more