The Glenlivet single malt whisky bucked the trend but Chivas Regal was among the losers as the Covid-19 crisis contributed to an overall decline in sales at Pernod Ricard in the first half of the French drink giant’s current trading year.
In common with some of its competitors, the firm said its business had been hit by falls in travel retail and the on-trade market, caused by pandemic restrictions, as it released its latest results yesterday.
Sales during the six months to December 31 totalled £4.38 billion, compared to £4.78bn in the first half of its 2019-20 financial year, while net profits for the period were down 6% year-on-year, at £847.8 million.
But with an improvement in the second quarter from the first three months, Pernod Ricard chairman and chief executive Alexandre Ricard said he was confident the company would emerge from the Covid-19 crisis stronger.
He added the firm was particularly encouraged by its “must win” domestic markets returning to growth.
With organic growth of 2%, The Glenlivet was one of only three of Pernod Ricard’s 13 “strategic international brands” to increase sales during the half year, along with Malibu, which leapt by 26% and Jameson Irish Whiskey, up 3%.
Sales of Chivas Regal, the firm’s flagship blended Scotch, were down 16% year-on-year.
The biggest drops in demand for brands in that division of the firm’s portfolio were suffered by Royal Salute whisky which was down 28%, Beefeater gin, which fell by 20% and Perrier-Jouet Champagne, which lost its fizz with a 19% decline.
There was better news for the company’s “speciality brands”, which include the Aberlour single malt whisky, along with a number of American whiskeys and other drinks, which recorded overall sales growth of 22%.
The firm hailed “particular dynamism” in the US, where sales were up 5%, helping it record a 2% increase across the Americas despite a “significant decline” in travel retail.
There was also a 13% increase in China and a return to growth in India of 2% during the second quarter, following a 6% fall in the previous three months.
Sales in Europe were down 5%, despite “continued very strong growth” in the UK, Germany, Russia and Poland.
Mr Ricard said: “We are particularly encouraged by our must-win domestic markets returning to growth in H1 FY21. The first half confirms the long-term sustainability and underlying strength of our business.
“Despite an uncertain and volatile environment, with disruption in the on-trade and a prolonged downturn in travel retail, we anticipate organic sales growth for full-year FY21, thanks in particular to our dynamic performance in domestic must-win markets USA, China and India.
“We will continue to implement our strategy, in particular accelerating our digital transformation, while dynamically managing resources.
“Thanks to our solid fundamentals, our teams and our brand portfolio, I am confident that Pernod Ricard will emerge from this crisis stronger.”
He added: “I would like to take this opportunity to praise our teams, whose engagement and performance are exemplary in these very challenging times, and to express our support to our on-trade and travel retail partners who continue to be impacted by the pandemic.”
