Pernod Ricard Full Year Profit Declines
French spirits and wines producer Pernod Ricard SA reported Thursday that group share of net profit for the full-year ended June 30, 2015 declined 14 percent from last year, despite sales growth, hurt by a hefty impairment charge on its premium brand Absolut Vodka business.
"Our full year results are solid, delivering improving Sales and Profit from recurring operations in line with guidance. Our strategy has remained consistent and is delivering results," Chairman and CEO Alexandre Ricard said.
The Paris, France-based Company reported that group share of net profit decreased 15 percent to 861 million euros from last year's 1.02 billion euros, due to impairment charge on Absolut premium Vodka.
Excluding net impairment charge of 404 million euros, Group share of net profit grew 25 percent from last year. Net sales for the full year rose 8 percent to 8.56 billion euros from 7.95 billion euros in the previous year, with a 437 million euro or 6 percent favorable FX impact. Organic Sales growth was 2 percent.
Sales in Europe declined 2 percent to 2.73 billion euros, while sales in Americas grew 11 percent to 2.38 billion euros and sales in Asia/Rest of the World improved 14 percent to 3.45 billion euros from last year. The company also reported market share gains in most key markets.
In terms of categories, the company said growth was driven by whiskies, with continued strong performance of Jameson, The Glenlivet, Ballantine's and Indian whiskies, as well as of champagnes Mumm and Perrier-Jouët, both in high single digit growth.
The company noted that Martell returned to growth, despite negative mix (China). Absolut was impacted by a challenging USA market but grew outside the USA.
The Top 14 returned to growth, with an organic growth of 2 percent amid a performance improvement driven by Ballantine's and Martell and continued strong growth of Jameson and The Glenlivet.
Profit from recurring operations grew 9 percent to 2.24 billion euros, and group share of net profit from recurring operations improved 12 percent to 1.33 billion euros or 4.99 euros per share from 1.19 billion euros or 4.46 euros per share a year ago.
The company has also proposed a 10 percent higher dividend of 1.80 euros for the full year, corresponding to a pay-out ratio of 36 percent, in line with the customary policy of cash distribution of approximately one-third of Group net profit from recurring operations.
"For FY15/16, despite a challenging and volatile macroeconomic environment, we aim to continue gradually improving our business performance. We will continue to support priority brands and innovations while focusing on operational excellence," Ricard added.
Pernod Ricard said it will communicate earnings guidance for the current financial year as part of its first quarter 2015/16 sales communication on October 22, 2015, in line with its standard practice.
In Paris, Pernod Ricard is currently trading at 91.67 euros, down 2.14 euros or 2.28% on a volume of 0.18 million shares. (dpa)
Other news from the department business & finance
Get the food & beverage industry in your inbox
From now on, don't miss a thing: Our newsletter for the food & beverage sector brings you up to date every Tuesday and Thursday. The latest industry news, product highlights and innovations - compact and easy to understand in your inbox. Researched by us so you don't have to.
