Rémy Cointreau SA reported first-quarter revenue that missed analysts’ estimates, as Rémy Martin cognac sales weakened in Europe and Asia.
Sales were unchanged on an organic basis in the three months through June, the distiller said in a statement. Analysts expected a 1.1% gain.
‘‘This is slightly below market expectations and is due to advance shipments in the fourth quarter before a global hike in prices,” wrote Virginie Roumage, an analyst at Bryan Garnier.
Rémy Cointreau is increasingly relying on the US, the largest market for Rémy Martin, as double-digit growth in the country is outpacing a slow recovery in China. There, the company is seeing improved trends for its cognac, after a government crackdown on extravagant spending had dented demand for the spirit. While Rémy Cointreau and Hennessy-owner LVMH have seen a sales rebound in China in recent quarters, Paris-based distiller Pernod Ricard, which owns Martell cognac, has forecast that the demand for international spirits such as cognac and scotch will shrink in the near term.
Revenue of the company’s flagship Rémy Martin cognac dropped 0.5%, missing the consensus for a 0.2% advance.
The company also said that demand for high-end cognac may accelerate, as it spends more on advertising. Rémy Martin had an ‘‘excellent” performance in the Americas, and a decline in revenue from the Asia-Pacific region was a ‘‘one-off” related to shipments to retailers, the distiller said.
The company maintained its forecast for higher operating profit from continuing businesses this year. Rémy Cointreau previously said that growth in the first quarter would be held back due to shipping more spirits from France to China ahead of price increases in Asia in the prior quarter.
Total revenue was €218.6 million ($240 million). Analysts expected €220 million.
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