Chivas Brothers pledges £60m to hit net zero

Pernod Ricard’s Scotch whisky arm, Chivas Brothers, will invest more than £60 million (US$76m) to reach its goal of carbon neutral distillation by the end of 2026.

The planned investment over the next three years will ‘accelerate’ the company’s effort to cut its energy and carbon footprint by installing electric boilers and implementing heat recovery technologies.

Chivas Brothers chairman and CEO Jean-Etienne Gourgues said: “We have fast-tracked a number of sustainability initiatives to meet our own ambitious targets and remain committed to supporting the industry in ushering in this new era —as we demonstrated earlier this year by making our heat recovery findings open source.”

In July, Chivas Brothers made its carbon-reducing technology available to the wider industry.

The move was made after the firm’s heat recovery technology was integrated at the Glentauchers distillery, lowering the site’s carbon emissions by 53%.

Gourgues previously said the company would put collaboration ahead of competition when it comes to working towards net zero.

The company announced the £60m investment at the same time as its full-year performance, which reached a 10-year high with sales up by 17% in the 12 months to 30 June 2023.

“The historic highs we’re seeing across our strategic brands signal the success of our premiumisation strategy which has enabled Chivas Brothers to outperform the market,” Gourgues added.

“Our highest growth of the last decade reinforces our position to shape the future of sustainable Scotch while continuing to meet demand.”

Scotch performance

The category’s full-year performance was led by blended Scotch brands Royal Salute (up by 32%), Chivas Regal (up by 25%) and Ballantine’s (up by 13%), and The Glenlivet single malt (up by 9%).

Chivas Brothers said Royal Salute grew ahead of the prestige and prestige-plus Scotch category by both value and volume in 2023.

The blended Scotch brand saw ‘strong growth’ in the US, and reported double-digit increases in core Asian markets, including Korea, India and Taiwan.

Chivas Regal’s performance was boosted by India and Japan, with the brand named the leading 18-year-old blended Scotch globally by both volume and value in 2022, according to IWSR Drinks Market Analysis.

Ballantine’s 21 and Ballantine’s 17 were the brand’s key growth drivers alongside Ballantine’s Finest.

The Asia region ‘excelled’ over the 12-month period for Ballantine’s.

The Glenlivet was the best-selling single malt by volume in 2022 (IWSR) with the brand’s performance led by ‘significant demand’ for its premium and ultra-premium ranges.

The Speyside single malt brand will celebrate its 200th anniversary next year.

Meanwhile, stablemate Aberlour single malt, which sits within Pernod Ricard’s speciality brands division, rose by 11%.

In terms of regions, Asia led growth for Pernod’s Scotch portfolio, up by 21%.

India climbed by 27%, Japan by 28%, South Korea by 19% and Greater China by 7%.

Within the North America region (up by 8%), the US rose by 8% and Canada by 7%.

Parent company Pernod Ricard, which also owns Absolut Vodka and Jameson Irish whiskey, reported an organic sales rise of 10% in fiscal 2023.

Irish whiskey sales

Pernod’s Irish whiskey division, Irish Distillers, reported an 11% full-year sales increase.

Jameson rose by 10%, including 56% growth in Asian markets, such as India (up by 51%).

The brand’s sales climbed by mid-single digits in the US, by 23% in South Africa and by 27% in global travel retail.

Irish Distillers’ prestige whiskey portfolio – which includes Redbreast, Midleton Very Rare, Spot, Method and Madness, and Knappogue Castle – soared by 22%.

Powers Irish whiskey grew by 18%, driven by the US.