Pernod Ricard H1 profits rise despite China woes
Strong performances in the US, Spain and the UK contributed to a 3% sales increase in Pernod Ricard’s half-year results, despite ongoing difficulties in China.
The French drinks group experienced an organic sales growth of 3% totalling €4.958 billion, while reported sales growth was up 7% due to a “favourable FX impact”.
Improvement was driven mainly by the US, with the Americas demonstrating an accelerated growth of 4% compared to 2% the previous year.
Europe saw improvement with a 1% sales increase thanks to Spain and the UK, alongside “encouraging growth” in the majority of markets despite declines in France and Russia partly attributed to “technical impacts”.
However, in spite of a 5% rise in Asia and the rest of the world China continued to prove troublesome with sales dipping 2%, accompanied by “difficulties” in Korea and travel retail Asia.
Across the firm’s top 14 key brands, Jameson Irish whiskey, Martell, The Glenlivet and Indian whiskies were cited as delivering a “strong performance” with an overall 2% organic sales growth in H2.
This was contrasted with “difficulties” for Chivas due to Asia and travel retail, while Absolut also struggled despite “improving” underlying trends in the US.
“Our half year results are solid, delivering a continued improvement in sales,” commented Alexandre Ricard, chairman and chief executive officer.
“Our strategy has remained consistent and is driving results, in particular in terms of innovation.
“For full year FY15/16, in a still contrasted macroeconomic environment, we plan to continue improving our business performance year-on-year vs. FY 14/15.
“We will continue to support priority markets, brands and innovations while focusing on operational excellence.
“We expect to deliver organic growth in profit from recurring operations in line with the guidance of +1% to +3%.”
Pernod Ricard executive reshuffle
Pernod Ricard also revealed a series of organisational changes to the company today, which will come into effect from 1 July 2016.
The reshuffle has been designed to simplify the Americas region to concentrate on the firm’s core business – the US and Canada – and also create two new management entities in keeping with the Pernod Ricard EMEA model.
These new management entities will be led by Noël Adrian, managing director of Pernod Ricard Mexico, and Thibault Cuny, managing director of Pernod Ricard Brazil.
Paul Duffy, chairman and CEO of The Absolut Company and a member of the COMEX, has been appointed chairman and CEO of Pernod Ricard North America and CEO of Pernod Ricard USA.
Philippe Dréano, current chairman and CEO of Pernod Ricard Americas, will retire in July after an “exemplary” 27 years with the drinks company.
Bryan Fry, managing director of Pernod Ricard USA, will take up the post of managing director of Pernod Ricard Pacific, reporting to the chairman and CEO of Pernod Ricard Winemakers. He replaces Julien Hémard whose new position will be announced in due course.
Elsewhere, Anna Malmhake, chairman and CEO of Irish Distillers and a member of the COMEX, has been appointed chairman and CEO of The Absolut Company.
Jean-Christophe Coutures, current chairman and CEO of Pernod Ricard Winemakers and a member of the COMEX, will replace Malmhake as CEO of Irish Distillers.
Bruno Rain, managing director in charge of group human resources and corporate social responsibility and a member of the COMEX, will move into the position of chairman and CEO of Pernod Ricard Winemakers.
Cédric Ramat, vice president human resources for Pernod Ricard Americas, will become human resources and corporate social responsibility director and a member of the COMEX.
Finally, Mohit Lal, managing director of Pernod Ricard Travel Retail Asia, will maintain his current role while also moving into the position of chairman and CEO of Pernod Ricard global travel retail and becoming a member of the COMEX.
“A company’s success depends above all on the women and men who bring it to life,” said Ricard. “Our group’s strength comes from these talents of diverse origins and backgrounds and our principle of global mobility, as illustrated by these organisational changes.
“In this spirit, I would like to pay tribute to Philippe Dréano for his unfailing commitment to our group’s development over the last 30 years.”