Pernod Ricard said it now expects organic profit growth of about 16% for its 2020/2021 fiscal year, up from a previous April forecast of 10%, as the French drinks group saw a stronger than expected recovery as COVID-19 curbs are lifted.
It added that off-trade continues to be resilient, while on-trade demand is accelerating as restrictions are progressively lifted.
'The pace of recovery is proving stronger than anticipated,' the company said in a statement. 'The off-trade continues to be resilient while on-trade demand is accelerating as restrictions are progressively lifted.'
The French spirits group remains confident about its prospects in Asia, helped by cognac and scotch whiskey demand in China, its Asia boss said.
Navigating The Uncertainties
"Despite the pandemic and the many uncertainties we have to navigate through, our business is resilient, rebounding and continuing its transformation," Pernod Ricard Asia chairman and chief executive Philippe Guettat said on a company YouTube presentation on Tuesday.
Guettat confirmed during a call with analysts the group's medium-term ambition for sales growth rates of high single to low double digits for China and low double digits for India.
Demand In Asia
China and India are the group’s two largest markets after the United States, each accounting for about 10% of group sales.
In China, cognac demand was booming in night clubs and was strong in restaurants, with customers spending heavily following the COVID crisis as they were travelling less, Guettat said.
There was also strong demand for scotch whiskey in China with strong double digit growth for all brands, including Chivas, Ballantines and Glenlivet. Scotch was attracting a younger crowd, aged below 30.
The South East Asia market remained difficult as the pandemic was hitting tourism and a recovery was not expected before the second quarter of fiscal year 2022, Guettat said.