PARIS (dpa-AFX) - Pernod Ricard SA (PDRDF.PK, PDRDY.PK,PRN.L), a French liqueur company, on Thursday reported lower net sales in the first quarter, with weak performance in all regions mainly U.S and China. Further, the firm maintained cautious outlook for fiscal 2027 and medium term till fiscal 2029.
In the first quarter, net sales totaled €2.234 billion, down 6.3 percent from last year's €2.384 billion. Organically, net sales edged down 0.9 percent.
The company said the drop in sales was mainly linked to the disposal of Imperial Blue and Wines.
Volumes in the first quarter returned to growth at 6 percent, with Strategic International Brand volumes growing 2 percent.
Among regions, Americas sales fell 11 percent from last year to €573 million, with sales in the US down 10 percent, impacted by inventory adjustments, as expected.
Europe sales declined 9 percent year-over-year to €685 million, while Asia/Rest of World sales fell 2 percent to €976 million. Sales in China declined 25 percent, impacted by inventory adjustments, as expected.
Organically, sales in Americas and Europe declined, but Asia/Rest of World sales grew 9 percent.
The company noted that underlying depletions in China returned to growth, confirming the cautious trade optimism ahead of the Mid-Autumn Festival, as flagged at the full year results.
Excluding the US and China, sales in the Rest of the World were growing at 4 percent, with strong performance notably in markets in the Asia-Rest of the World region and with softer results in Europe and in Latin America.
Looking ahead for fiscal 2027, Pernod Ricard said it continues to expect organic Net Sales broadly stable for the full year, in a contrasted and uncertain environment.
The outlook reflects declines in the US and China, impacted by inventory adjustments, and with underlying trends expected to improve in China.
The firm also sees continued positive momentum in Rest of World, with ongoing strong growth notably in India.
Further, for the medium term, the company still projects organic net sales growth on average, close to the lower end of the 3 percent to 6 percent range over fiscal 2027 to fiscal 2029, amid the current softness in the US market.
The company also projects organic operating margin expansion, supported by accelerated operational efficiencies of €1bn from fiscal 2026 to fiscal 2028.
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