Pernod Ricard Accelerates Sales Growth and Improves Margins
Pernod Ricard achieved sales of €8.99 billion for its 2018 financial year, after accelerating its organic sales growth to 6.0% from 3.6% the previous year. Sales growth was broadly based across a wide spectrum of markets – Americas grew by 6%; Asia-Rest of the World rose by 9%, due to strong growth in China and India; and Europe displayed modest growth of 2% with good momentum in Eastern Europe, Germany and the UK but difficulties in France and Spain.
Pernod Ricard also accelerated the organic growth (from 4% to 7%) of its 13 Strategic International Brands, with 11 in growth. Martell (+14%) and Jameson (+14%) performed particularly strongly during 2018, and the Scotch whisky portfolio returned to growth. Innovation continued to contribute significantly to Pernod Ricard’s top line growth.
On a reported basis, group sales declined by 0.3%. Profit from recurring operations (PRO) at €2.358 billion was up 6.3% organically but down 1.5% reported. The PRO margin was up 14bps organically but down 34bps on a reported basis due to adverse foreign exchanges factors (-€180 million).
Alexandre Ricard, chairman and chief executive of Pernod Ricard, comments: “FY18 was a very strong year. Consistent strategic implementation has enabled us to deliver a significant improvement in business performance while investing for the future. Our sales have accelerated and diversified, and our margins improved. In FY19, in a still uncertain geopolitical and monetary environment, we will continue consistently implementing our strategy. Our guidance for FY19 is organic growth in Profit from Recurring Operations between +5% and +7%.”
