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Pernod Ricard reports Southern Europe sales “improving”

The challenging economic situation in Spain and southern Europe is “improving slightly” according to Pernod Ricard, which has posted its nine-month financial results for 2012/13.

“Remarkable” sales of Beefeater gin have driven slight recovery in Spain

The French drinks group has reported a slight improvement in Q3 in Western Europe although sales declined by 3% overall. However, it claims the situation in southern Europe remains “challenging but improving slightly” with a better performance in Spain.

The result it reports has been driven by “remarkable growth” of Beefeater gin, which earlier this week revealed a new super-premium oaked brand extension, Burrough’s Reserve.

It’s the sales of such premium brands, including Martell and Jameson, that have helped Pernod Ricard remain “resilient” in the past nine months overall.

It reported a sales growth of 5% to €6.65bn in the first nine months of its 2012/13 financial year, driven by the US (7%) emerging markets including China(11%), India(17%) and Russia (19%).

While Pernod Ricard’s Scotch portfolio endured continued slowdown in Korea and Thailand, sales of its Indian whisky stable grew 20% as pricing improved and consumers traded up to premium brands. Martell Cognac meanwhile grew 18% in Asia, “bolstered by price/mix that remains significant”.

In the States the group’s major growth driver remains its Irish whiskey brand Jameson (23%), which continues to lead the category. Single malt Scotch brand The Glenlivet is also staying strong in the US with 15% growth.

“Pernod Ricard’s business demonstrated good resilience in, as announced at the beginning of the year, a less favourable economic environment,” commented Pierre Pringuet, CEO of Pernod Ricard. “Our growth is still based on the same drivers: our policy of premiumisation and innovation, the strategic brands and strong presence in emerging markets and the United States.

“Confident in the strength of this mondel, we confirm our guidance of organic growth in profit from recurring operations of close to +6% for the full financial year 2012/13.”

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