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Rémy H1 organic sales dip but remain ‘in line’ with target
Rémy Cointreau’s woes continue as organic sales slide -5.9% amid technical and macro-economic headwinds, but the Group insists its H1 performance was “in line with annual targets”.
Rémy Cointreau’s Cognac brand leads the Group’s H1 decline in organic sales
The Group achieved consolidated sales of €500m for the first half of its 2015/16 financial year to 30 September 2015. It achieved reported growth of +6.1%, but organic sales fell by -5.9%.
Current operating profit reached €107.0 million, with reported growth of 4.7%, “driven by positive exchange effects”, said the company. Organic COP fell -7.3% due to a technical drop in volumes and to the “unfavourable mix” over the half-year. However, noted the Group, COP margin was kept “virtually stable” at 21.4% as it reined in A&P spend and administrative expenses.
Excluding non-recurring items, Group share of net profit saw reported growth of 7.1% to €68.6 million.
In terms of brand performance, Rémy Martin organic sales fell -3.1% to €313.1m, due to declines in Asia Pacific attributed to the Group’s strategic plan (improved product mix and adapting its China distribution network) and the caution Chinese wholesalers weighted on shipments. However the Americas and EMEA regions posted an “excellent performance”.
The Liqueurs & Spirits division posted an organic sales decline of 8.3% to €129.9m, due to high comparables for Cointreau in the US, the timing of Easter, distribution changes, and macro-economic factors in Russia and Greece. However Cointreau’s sales decline masked an “excellent” performance in the US and a “return to growth in Western Europe”. Metaxa sales “fell significantly”, attributed to the slowdown in consumption in Greece and Russia, and in travel retail purchasing by Russian customers. Islay Spirits (Bruichladdich single malt whisky and The Botanist gin) reported double digit growth, and Mount Gay rum posted a “solid” performance.
Looking forward to the rest of the 2015/16 financial year, the Group said in a statement that it “confirms its objective of delivering positive growth in current operating profit” at constant exchange rates and scope.
Rémy Cointreau’s 2015/16 half-year results follow a mixed Q1, when organic sales declined -9.0%.