Pernod Ricard Reports Sales and Profit Growth for Fiscal Year 2017
Pernod Ricard reported a 3.6% organic sales growth and a 13% increase in net profit for the fiscal year 2017. The company expects continued growth in the upcoming fiscal year.
Pernod Ricard, the spirits producer, announced strong results for its fiscal year 2016/17 on Thursday, August 31, 2017. The company's sales grew organically by 3.6% to reach €9 billion, with expectations for continued growth in the next fiscal year.
The sales increase was particularly driven by international brands, which saw a 4% rise compared to a flat performance in the previous year. Sales of Martell cognac and Absolut vodka returned to growth. Geographically, the strengthening of sales was led by growth in the United States, China, Eastern Europe, and the global travel retail channel.
Operating profit increased organically by 3.3% to €2.4 billion, and net profit rose by 13% to €1.4 billion. The company also successfully improved its operational efficiency and reduced its debt, leading to a decrease in the net debt to EBITDA ratio from 3.4 to 3.0. Free cash flow saw a significant increase of 22%.
Pernod Ricard has also actively managed its portfolio by acquiring majority stakes in promising premium brands and divesting non-core assets. Chairman and CEO Alexandre Ricard stated that the group's strategy is delivering results and guided for an expected organic growth in profit from recurring operations between 3% and 5% for fiscal year 2018.