FRENCH spirits giant Pernod Ricard said it expected a good year as emerging markets fuelled sales rises – but the upbeat statement failed to impress investors yesterday.
Pernod posted net profit of €951m (£791.6m) for the year to the end of June, up one per cent on a year earlier. But shares in the world’s second-largest spirits group after Diageo closed down 2.4 per cent at €61.25 on the Paris exchange after the results missed analyst’ forecasts due to weaker-than-expected trading in Europe.
The company, whose brands include Glenlivet whisky and anise drink Ricard does not give a detailed forecast for the year ahead until a shareholders meeting in November.
However, chief executive Pierre Pringuet predicted a surge in sales in emerging markets, particularly in Asia. He added: “We are having a good start to the year … the world is doing better.”
Pringuet also said there were “encouraging” signs in Europe but austerity measures to rein in government spending were taking their toll in Greece while Spain was still on a negative trend, he said.
He added the UK is also part of that downward trend as the hangover from recession takes its toll.
But the company’s Martell cognac and Chivas Regal scotch have proved popular in China and Latin America.
Pernod also owns the Mumm champagne brand, which was the worst performer out of its top 14 labels. The Paris-based company has completed its €1bn asset disposal plan and was “well on track” to achieve its goal to generate free cash flow from operations of €3bn over the three years to 2010-11.
Last week rival Diageo forecast slightly higher profits growth this year driven by developing markets but said the economic recovery was variable.