Pernod Ricard, the world’s second-largest spirits maker, posted a “robust performance” in the first half of its 2024 fiscal year despite a slight sales decline.
Chairman and CEO Alexandre Ricard said the company, owner of brands including Absolut vodka and Jameson whiskey, is navigating “the normalisation of the spirits market following two years of outstanding growth”.
Sales dipped 3% organically (7% reported) to €6.59bn. However, the company managed to expand its gross margin significantly through strong pricing actions, offsetting lower volumes and maintaining its operating margin.
Pernod Ricard’s premium portfolio strategy, which drove high single-digit pricing across all regions, proved successful. The Americas saw a 7% sales decline, impacted by a high comparison base and inventory adjustments. Asia-RoW experienced a 1% sales increase, with India a particularly strong performer. Europe witnessed a 4% sales decline, though some markets like Central and Eastern Europe showed resilience. Global Travel Retail sales dipped 3%.
Looking ahead, Pernod Ricard expects dynamic sales growth in the second half of 2024, leading to broadly stable organic sales for the full year. The company remains confident in its medium-term financial framework of 4% to 7% top line growth, aiming for the upper end of the range.
Alexandre Ricard commented: “We achieved strong Gross Margin expansion on the back of substantial pricing actions, thanks to the power of our premium portfolio. With a diversified footprint spanning mature and emerging regions and a broad presence across spirits categories, we are able to weather volatility and continue to gain share in many markets.
“I am convinced that our sound strategy, together with the dedication, agility, and exceptional engagement of all our teams around the world, will enable us to deliver our ambitions.”
