Pernod courts booming US spirits market

Pernod Ricard is looking to grow its presence in the US marketplace, with company bosses admitting their products are currently “under-exposed”.

The drinks giant is turning its gaze to the US as China and other key markets experience a dip

As the US market experiences a boom, the French drinks group has voiced its desire for further small acquisitions and mergers, claiming that bolt-on acquisitions could be a short-term option.

Pernod Ricard deputy CEO Alexandre Ricard, who is taking over from CEO Pierre Pringuet in 2015, said: “The American market is a region that we are looking at from a mergers and acquisitions point of view.

“The U.S. market is the largest market in the spirits industry. It represents about 40% of the profits of international spirits. The U.S. market represents just a quarter of our profits.”

Although viewed somewhat as a source of untapped potential by the company, the US market has helped Pernod Ricard offset a slowdown in Chinese sales in the last fiscal year.

Announcing its full year 2012-13 financial results, the drinks giant admitted to have suffered a decline in sales of its high-end and Scotch brands in parts of Asia, most notably China, but reaped the benefits of an 8% growth in the US which aided the company in delivering a 6% profit increase overall.

The company also announced its plans to pursue markets in Mexico, Brazil and South Africa, where it believes an emerging middle class holds promise for premium spirits.

However, Alexandre Ricard has also stress that he is “absolutely confident” the Chinese market will start to improve early next year.