Pernod Ricard travel retail sales plummet 64% in Q1
Jameson Irish whiskey owner Pernod Ricard experienced a 64% decline in global travel retail sales during the first quarter of its 2021 fiscal year as passenger numbers remain significantly down.
Despite the hit on global travel retail (GTR) sales, Pernod Ricard also noted the ‘positive impact’ of opening Hainan island, China, to duty free spirits sales.
Overall, Pernod Ricard’s Q1 2021 sales were down 6% compared to the previous year’s quarter. However, the company said this was a ‘marked improvement’ over the fourth quarter of fiscal 2020.
Looking ahead to the rest of 2021, Pernod Ricard, whose portfolio also includes Absolut Vodka, expects continued ‘uncertainty and volatility’, particularly due to the impact of sanitary conditions on social gatherings and travel. The French drinks group also expects ‘prolonged downturn’ in travel retail and on-trade disruption throughout full-year 2021.
Commenting on the group’s financial results, Alexandre Ricard, chairman and chief executive officer, said: “We will continue to implement our strategy, in particular accelerating our digital transformation. We will tightly manage costs while maintaining the agility to reinvest to adjust to market opportunities.”
In an interview with The Spirits Business last week, Pernod Ricard GTR chair and CEO Mohit Lal advised that while e-commerce presents a lot of opportunities in travel retail, its potential is limited until international travel returns to normal.
However, he also believes that once a Covid-19 vaccine is widely available, international travel could rebound in six months. But, Lal added that business travel would likely remain suppressed for longer due to how companies have adapted during the pandemic.