Drinks giant Pernod Ricard reported record year of sales in the Fiscal Year 2022, growing 17% organically to surpass the €10 billion mark for the first time during the period, driven by what it describes as “strong, balanced and diversified growth”.
The growth is believed to be the fastest growth rate in over 30 years, bringing the company’s net sales to €10.7 billion, while its profits also set a record at €3 billion, the company said in its latest financial report.
“Three words summarize Pernod Ricard’s excellent performance in FY22: record, balanced and sustainable. FY22 was a record year in many respects. Our Sales broke the symbolic milestone of €10 billion with our fastest growth rate in over 30 years, delivering a record €3 billion profit from recurring operations at a record operating margin of 28.3%,” says Alexandre Ricard, Chairman and Chief Executive Officer.
The company, owner of Jameson and Chivas, said the growth mainly come from premium categories of drinks priced €15+ and €25+. Together they account for 76% of the company’s net sales.
In terms of region, Asia and Rest of World contributed 41% of the group’s net sales, led by India, Turkey, China, and Sub-Saharan Africa. India grew by 26%, thanks to favourable economic recovery and premiumisation trend.
In China, despite admitting the company’s sales are significantly impacted by Covid measures from March this year, Pernod Ricard’s overalls sales in the market increased by 5%, thanks to gradual easing of restrictions since June, Martell’s strong performance and excellent performance of single malts. The Glenlivet’s sales almost doubled on an already very strong basis, according to the company.
Travel Retail’s quick recovery also lifted Pernod Ricard’s overall gains. The sector grew by 48% during the year and is expected to return to pre-Covid level in 2023, the company predicts.
Notably, all spirits categories recorded double digit growths led by Jameson, Chivas Regal, Ballantine’s, Absolut and Martell.
Unfortunately, its wine portfolio underperformed. The owner of 10 different wine brands including Jacob’s Creek in Australia and Brancott Estate in New Zealand revealed its overall sales dropped by 4%, in particular due to New Zealand’s lower harvest.
Its two Champagne brands, Perrier Jouet and Mumm under Prestige Brands, on the other hand excelled. Perrier Jouet’s sales jumped by 32% driven by its vintage champagne ‘Belle Epoque’ notably in Japan and the US.
Mumm Champagne’s good pricing and strong performance in Japan and the US lifted its sales by 9% during the year.
Looking forward, the company is confident in achieving its financial goals in the next three years. “While we are faced with a challenging and volatile environment, I am confident that our unique competitive advantages and the rapid deployment of our digital transformation will enable us to deliver our FY23 to FY25 medium-term financial framework,” says Ricard.