Absolut vodka maker Pernod Ricard has warned it faces a softer fourth quarter against a backdrop of Covid restrictions in China.
The spirits firm’s chief financial officer said it was anticipating “an impact” from Covid restrictions during the fourth quarter.
“March was very impacted by the start of Covid restrictions,” Helene de Tissot told the Reuters news agency.
“Much will depend on how fast these restrictions can be lifted but the coming weeks may be difficult. This is part of our forecasts for the year,” she added.
China’s two largest cities, Beijing and Shanghai, are presently subject to lockdown restrictions, posing challenges for global economies.
It comes as the Martell cognac producer forecast organic growth of 17 per cent in profit for its financial year ending 30 June. This was paired up with estimates from analysts for 16.9 per cent growth.
Pernod posted sales of €2.44bn (£2.13bn) in the quarter ended 31 March, a 20 per cent like-for-like increase, surpassing analysts’ forecasts.
Sales growth was driven by Europe despite the impact of Russia’s invasion in Ukraine from the end of February.
Some three per cent of Pernord’s sales had typically come from Russia, yet the spirits maker stopped exports to the country last month.
“The global environment remains volatile with an increasingly challenging and inflationary context,” chairman and CEO Alexandre Ricard added.
Ricard also stressed the company was anticipating a “softer” fourth quarter due to Covid measures in China, as well as “phasing normalization in the US” and war in Ukraine.