Paris-listed drinks giant Remy Cointreau toasted its third quarter today, after sales growth exceeded expectations.
Although organic sales growth slowed, strong cognac performance meant the company exceeded consensus expectations to post an increase of 3.2 per cent.
But investors were not totally reassured by the update, and shares fell almost four per cent this morning.
Organic growth for the nine months to December 2017 was 5.5 per cent, with the third quarter slowed by the late timing of Chinese new year. The group said that adjusted for this one-off effect, third quarter growth would have risen by 6 per cent.
Sales reached €826.1m (£728.9m) in the first nine months of the financial year, with growth driven by group brands such as House of Rémy Martin which was up 11.5 per cent. In contrast partner brands income dropped 8.5 per cent, partly due to the end of distribution agreements with champagne brands.
In line with changing consumer tastes, Mount Gay and St-Remy brands were moved upmarket, which the group said has limited growth but had a positive effect on its price mix.
"Despite strong global demand for cognac, we believe Remy is trading well above intrinsic value," analysts at Liberum said this morning.