Pernod Ricard Sees Revenue Impacted by Currency Adjustments and Stock Changes
Pernod Ricard reported a revenue of 2,384 million euros for the first quarter of 2025/26, showing a decline due to unfavorable exchange effects and stock adjustments.
Detailed Financial Performance
Pernod Ricard's revenue for the first quarter of fiscal year 2025/26 amounted to 2,384 million euros, with a significant negative impact of 143 million euros due to unfavorable currency exchange effects, primarily related to the US dollar, Indian rupee, and Turkish lira. Additionally, there was a negative scope impact of 54 million euros mainly associated with the divestment of wines. Sales performance in the United States displayed encouraging signs, although the overall revenue in the country declined due to stock adjustments. In China, revenue significantly dropped, influenced by a challenging macroeconomic environment and stock adjustments. In India, the underlying growth remains dynamic with some exceptions, notably in the state of Maharashtra where revenue is impacted by an excise tax change.
Market Recovery and Strategic Outlook
Pernod Ricard anticipates a recovery in the Global Travel Retail market in the second quarter, particularly with the expected resurgence of cognac sales in Chinese duty-free stores. The company projects that fiscal year 2025/26 will be a transitional year with an improvement in organic revenue trends starting from the second half. Strategic investments will be kept below 900 million euros, while the focus will be on resource optimization and operational efficiency. Pernod Ricard expects a negative currency impact for the year and is concentrating on preserving its organic operating margin through strict cost control and an operational efficiencies program.
Geographical Performance and Future Outlook
Pernod Ricard's diversified geographical exposure has enabled strong performances in several regions, thus mitigating declines observed in certain key markets. Sales in the Americas decreased by 12%, with a notable 16% decline in the United States, offset by strong growth in Canada. In Asia-Rest of the World, China recorded a 27% decrease, while Japan maintained strong growth. Europe saw a slight decrease of 4% in its total revenue. Looking ahead to future trends, the company anticipates an improvement in organic revenue growth and an increase in organic operating margin between 2026/27 and 2028/29.
