Editors' pick: Originally published Sept. 9
"The market is being driven by premium brands and that is good news for the likes of Jameson," said Alexandre Ricard, CEO of Pernod Ricard. "The higher you go up the ladder, the more dynamic that is for the industry."
Last week, the world's second-based drinks maker after Diageo (DEO) said profit from recurring operations rose 2% to just under €2.28 billion ($2.54 billion) in the fiscal year ended June. It attributed the rise to tight management of resources and operational efficiency initiatives.
On an organic basis, sales rose 2% to €8.68 billion in fiscal 2016, as growth in the Americas picked up momentum particularly in the U.S. Sales in the Americas grew by 4%, up from a 2% growth rate the year before.
Pernod's U.S. sales continued to be driven by Jameson, which grew by 23% in Nielsen channels, as well as from upscale brands The Glenlivet (+9%) and Martell (+25%) and a positive performance by Malibu (+2%).
In Asia and the rest of the world, double-digit growth in India and Africa and the Middle East offset difficulties in China, Korea and travel retail, while in Europe the company reported "encouraging" growth in most markets, led by Spain.
"We are very bullish on China medium term, but right now the environment in China is a little subdued," said Ricard.
On its home turf of France, Ricard said the decline in tourism due to recent terrorist incidents is not hurting the company's overall business, as tourists will consume their products elsewhere.
Focusing on Pernod Ricard's brands, strong performances of Jameson, Ballantines, Perrier-Jouet and Indian whiskies outshone Chivas and Absolut, where the company said it experienced difficulties, although year-on-year trends in the U.S. are improving.