Pernod Ricard shows high spirits
the last year, offsetting difficulties in Europe to lift the
group's organic sales by seven per cent.
Pernod Ricard posted a glittering 68 per cent sales rise for the full year ended 30 June 2006, although 61 per cent of that was attributed to the addition of brands belonging to Allied Domecq - which Pernod bought out last year.
It was double-digit growth from big spirits brands, including Martell, Jameson and The Glenlivet, that lifted Pernod's comparable sales from the previous year.
The results follow a good premium spirits performance for Pernod's big rival, Diageo, and suggests blockbuster spirits brands have become increasingly important for alcoholic drinks firms over the last year.
Pernod, also like Diageo, struggled to regain momentum in Europe, however. Sales slipped 1.6 per cent in the region, largely due to slight sales declines at home in France, and the firm scaled down its promotion spend to lift profits there.
There were signs too that brands previously belonging to Allied Domecq had endured a challenging year.
"Allied Domecq brands achieved sales of € 2.390m, which were adversely affected by destocking in a number of markets (including Spain, Mexico) and the termination of sales that generated parallel imports to other markets, in particular in Central America," Pernod said.
Still, Pernod's net profits rose 32 per cent, again benefitting from the Allied deal.
The group announced that the integration of Allied Domecq into its business had been completed in 11 months and at the lower cost of €350m, instead of the estimated €400m.
"As early as the 2006/07 financial year, Pernod Ricard will benefit from the full € 270m expected synergies in structure costs, that is a year earlier than initially planned."
The firm predicted organic sales for the next financial year would grow between four and six per cent, and that Allied brands would perform better now that the transition period had ended.
