French spirits group Rémy Cointreau has reported a fall in first-quarter organic sales, reflecting weaker U.S. demand, high year-ago comparables and destocking, and said it was banking on a sharp rebound in sales in the U.S. from the third quarter.
The maker of Rémy Martin cognac and Cointreau also stuck to a forecast for flat organic sales in the full 2023/24 financial year, reflecting a sharp decline in sales in the first half followed by a strong recovery in the second half.
Sales for the three months to June 30 reached €257.5 million, marking an organic fall of 35%, which was in line with the company-compiled consensus of a 35.6% fall from 17 analysts.
Sales in the cognac division alone fell 44.7% on an organic basis in the quarter, as weak U.S. sales outpaced very strong growth in China driven by a recovery in demand in bars and restaurants and e-commerce growth.
For the full year 2023-24, Rémy Cointreau said it anticipated 'continued strong normalisation of consumption in the United States' and 'strong growth in the rest of the world, led by major gains in China, a very good showing in EMEA and the rest of Asia, and business similar to levels observed in 2019-20 in travel retail'.
During the COVID-19 pandemic, Rémy Cointreau and rival spirit makers such as Pernod Ricard benefited from people drinking more expensive types of alcohol at home.
There have, however, been signs that spirits industry growth was slowing, notably in the United States, as positive effects from the pandemic fizzle out.