Pernod Ricard has reported that its organic sales have fallen 14.5% during its third quarter due to Covid-19 impact, despite a solid start to the quarter.
The French spirits maker posted sales of €1.74 billion in the three months to 31 March 2020, representing a 14.5% fall on a like-to-like basis.
In March, the owner of Absolut vodka and Martell cognac warned of a 20% hit to its full year current operating profit due to Covid-19 going global. In its third-quarter results, the firm has confirmed this guidance of a 20% organic decline.
Over nine months, the company has witnessed its sales decline by 2.1%, reflecting a 11% drop in China sales and a 13% decrease in global travel retail. The global coronavirus crisis has caused on-trade closures, social distancing measures and restrictions around travel.
This was offset by strong performance by Jameson, The Glenlivet, Malibu and its Specialty brands which posted a 13% rise in organic sales for the first nine months. These include the brands Lillet, Altos, Redbreast, Aberlour, Del Maguey and the recently fully-acquired Monkey 47.
Alexandre Ricard, chairman and CEO of Pernod Ricard, said: “Performance in H1 through the start of Q3 was solid, thanks to the implementation of our Transform & Accelerate strategic plan. Since then, the Covid-19 pandemic has led to a significant deterioration of the environment across the globe.
“We are staying the strategic course while implementing a comprehensive action plan to mitigate costs and tightly manage cash. Thanks to our solid fundamentals and strong liquidity position, I am confident in Pernod Ricard’s ability to bounce back from today’s challenges to achieve its growth potential.”
While a €523 million share buy-back programme was completed in the financial year, Pernod Ricard has suspended its remaining share buy-back programme of up to €500 million.
© FoodBev Media Ltd 2020
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