Pernod Ricard’s half-year sales fall 5.9%
Pernod Ricard has reported a sharper-than-expected decline in first-half sales, driven by steep falls in its two biggest markets, the United States and China. The group said performance elsewhere was broadly stable, with India and travel retail delivering modest growth.
Pernod Ricard’s sales in the six months to Christmas were €5,253 million, an organic decline of 5.9% compared with 2024 and 14.9% lower on an absolute basis. Operating profit was 19% lower.
Although the figures were weaker than expected by the market, Pernod Ricard’s shares were marginally higher in Paris at €82. Three years ago, they stood at €213.
US and China sales slump drives weakness
Chairman and chief executive Alexandre Ricard pointed out that two of the company’s three largest markets, the United States and China, had suffered big sales declines, but elsewhere trading was “broadly stable”.
Sales in the US were 15% lower, where spirits market conditions remained “soft”. China was down by 28%.
India and travel retail provide growth
On a brighter note, India was 4% ahead while global travel retail gained 3% in sales.
No figures were given for UK trade, but it was reported as “resilient in a market showing signs of stabilisation”.
brand volumes rise but net sales fall
In brand terms, volumes of Absolut vodka, Jameson, Ballantine’s and Chivas Regal were all ahead of their 2024 first-half result, but all were lower in organic net sales.
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Ricard said: “I remain confident in the attractive fundamentals of our industry, Pernod Ricard’s strategy and the resilience of our operating model to deliver sustainable value over time.”
He pointed out that the rate of sales decline was slowing from 7% in the first quarter to 5% in the latest three months and said he expects continued improving trends in sales, but noted that fiscal 2026 is a “transition year.”
“We will defend our organic operating margin to the fullest extent possible, supported by strict cost control,” the company said. The group has previously set out a mid-term plan to save €1 billion through operational efficiencies, a third of which will be made this fiscal year.
“Our priorities are clear”, he said. “To strengthen the desirability of our brands as a foundation of long-term, sustainable growth; to drive greater efficiency across the organisation; and to enhance cash generation.”
Over the medium term, Pernod is targeting organic sales growth of between 3% and 6% with a wider operating margin.
Reports swirl over potential India listing
Earlier, Ricard had downplayed rumours of a listing for the company’s shares in India. He said it was one of a long list of options the company reviews annually.
Overnight, there had been multiple reports from India that such a move was being mulled.
The suggested reason for listing shares in Mumbai would be to tap the vast Indian desire for share ownership and thus increase the potential price.
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