Economy: turnover of 9182 million euros for Pernod Ricard
The world’s number two spirits group published its annual results last Thursday. They revealed a turnover of 9182 million euros for the period 2018/2019.
A good omen for analysts
Analysts welcomed the results of Pernod Ricard, which translated its turnover into an increase of 5.3% and 6%. Organically, the group grew by 6%, a higher than expected growth in the fourth quarter.
Return on capital (ROC) rose from 9.5% to 2581 million euros. Organic growth was higher than expected: +8.7%. It is its highest level since 2012, according to Oddo. Analysts believe that the group has many capabilities to achieve its medium-term objectives.
A rise in the CAC 40, Pernod Ricard stronger
On Monday, September 2, the French stock index CAC 40 closed higher. The good news was supported in part by Pernod Ricard’s growth (+2.01% at EUR 177.20).
In fact, its strong results published since Thursday 31, also led to the search for its shares on the stock exchange. In addition to the results of their strong growth, they announced a generous increase in their dividends, of 3.12 euros per share. As a result, Pernod Ricard’s shareholder remuneration has risen to 32%. (Le Revenu).
After publishing its results, the group noted the growth in several countries and continents:
- USA: sold out in line with the market and strengthening of route-to-market, but sales decreased due to optimization of inventory of U.S. wholesalers.
- China: +21%, excellent performance thanks to Martell’s strong dynamism and growth relays;
- India: +20%, with continued expansion of Seagram’s Indian whiskies and Strategic International Brands;
- Canada and Latin America: +2%, acceleration in Canada, strong growth in Latin America.
- Asia-Rest of the World: +12%, strong acceleration mainly driven by China, India and Turkey and continued strong growth in Japan.
- Europe: +1%, slight growth in a contrasting environment, with continued strong growth in Eastern Europe partly offset by Western Europe (difficult market in France and commercial disputes).
India: Third Global Strategic Market
The South Asian country has the development of whisky, with brands such as Seagrams and Strategic International Brands. But white spirits such as Beefeater and Absolut are also among the fastest growing spirits. Growth in India is expected to be driven by a shift in consumer demographics, rapid urbanization and a demand for premium offerings.
According to Alexandre Ricard, Chairman, CEO and member of the Board of Pernod Ricard SA, part of the performance in India was driven by a weak base in the previous fiscal year. That today they have low double-digit value growth is beneficial if you are in India, “especially when you are a market leader”. This low double-digit is “sustainable in the long term”.
Pernod Ricard and whisky
Among other news, Pernod Ricard recently announced the acquisition of the New York whisky brand Castle Brands, creators of Jefferson’s bourbon, for $223 million.
In addition, the construction of a distillery in China, in the province of Sichuan should see the day in 2020. This construction has a value of 130 million euros.
The brand of this whisky has not yet been revealed, but the first bottle should be born in 2023.
Don’t drink and drive. Enjoy responsibly.