Pernod Ricard ups 2021 profit forecastBy Nicola Carruthers
Jameson owner Pernod Ricard has raised its profit prediction for fiscal 2021 to 16% due to the acceleration of the on-trade.
The French firm, producer of brands such as Absolut vodka and Havana Club rum, previously predicted an organic profit growth of 10% for the full year.
The company expects 2021 to be in line with fiscal 2019, despite restrictions in the on-trade and travel retail.
In April, Pernod Ricard reported its organic sales returned to growth in the first nine months of fiscal 2021, driven by a double-digit increase in the third quarter.
In a new update today (23 June), Pernod Ricard has raised its profit prediction due to ‘sales acceleration’ brought about by the gradual reopening of the on-trade.
However, the firm said the travel retail channel remains ‘very subdued’. For the first nine months of fiscal 2021, Pernod’s global travel retail sales plummeted by 50%.
The firm said the pace of recovery is ‘stronger than anticipated’ with a ‘resilient’ performance from the off-trade and ‘accelerated’ demand from the on-trade.
Pernod Ricard also expects its advertising and promotion spend to increase by 16% for fiscal 2021. The company said it would make ‘strong reinvestment to capture current and future growth opportunities’.