New Year lifts Chinese sales for Pernod

French drinks group Pernod Ricard said sales trends in China, its second-largest market, were gradually improving thanks to a positive performance during the country's New Year celebrations.

Like rivals Diageo and Remy Cointreau, Pernod has been hit by a government crackdown on luxury gift-giving and personal spending by civil servants in China, as well as by slowing economic growth in the world's second-biggest economy.

Sales of Pernod Ricard products from wholesalers to retailers in China rose 7 per cent year-on-year by volume in the December-to-February period, according to slides published by the company ahead of a conference call on Asia.

Martell sales volumes over the period jumped 13 per cent but whisky sales volumes were down 6 per cent, Pernod said.

Year-to-date Pernod Ricard sales volumes from wholesalers to retailers in China were up 1 per cent, which the group said was consistent with its guidance for full year 2014/15 organic growth in profit from recurring operations of between 1 per cent and 3 per cent.

The spirits group makes 12 per cent of sales and 15 per cent of profit in China. Asia now accounts for 39 per cent of sales and 42 per cent of annual profit for Pernod Ricard.

In February, Pernod Ricard said that its sales in Asia were flat in the first half ended December 31st, hit by a 16 per cent slump in Chinese sales.

Reuters