Pernod Ricard SA said quarterly sales were flat as weak demand in the US and China markets for its pricey booze continued.
The spirits maker, whose brands include Jameson, Absolut Vodka and Martell Cognac, said sales were stable in its most recent quarter at €2.3 billion as US retailers destocked and Chinese drinkers remained cautious. That missed analyst third-quarter consensus estimates of 2.8 per cent growth and €2.5 billion in sales.
The company said volumes rose 1 per cent during the quarter, marking the first volume growth in a year.
Pernod said its expects sales to improve in the fourth quarter compared to the yearly performance so far and kept its forecast of flat sales for the year. It said it expects organic operating profit from recurring operations to grow by 1 per cent this year.
Pernod and other premium distillers have been facing weak sales in the US due to high stock levels as drinkers cut consumption of pricey spirits after soaring demand during the pandemic. Pernod has raised prices to offset lower volumes and higher input costs.
A rebound in China has been weaker than expected following an anti-dumping probe into French brandy, including cognac. Chinese authorities began the investigation after the European Union began looking into its electric vehicle subsidies.
Pernod said sales in India and travel retail purchases in Japan helped offset the weak performance in the US and China during its third quarter.
The company had previously said it expects low single-digit organic operating profit growth for the year. - Bloomberg
