Pernod Ricard: Revenue Down 3.9%, Dividend Maintained for 2025-26
Pernod Ricard published on August 27, 2026 the results of its 2025/26 fiscal year, marked by an organic decline in revenue and current operating income, due to weakness in the United States and China.
The spirits group highlights strengthened cash generation and margin defense, while its net debt declines slightly and the dividend is maintained.
Organic Revenue Down 3.9%, Dragged Lower by the United States and China
2025/26 revenue stands at €9,404 million, down 3.9% on an organic basis and 14.2% as reported, the latter incorporating a negative currency effect (US dollar, Indian rupee, Turkish lira) and a scope effect related to brand disposals. Excluding the United States and China, activity grows by 0.5%.
By region, the Americas decline by 10% (United States −14%) and China by 19%, in a context of weak consumer confidence and regulatory measures. Conversely, India grows by 7% and the Africa and Middle East region shows growth driven by Turkey, Nigeria and South Africa.
The group emphasizes an improved trajectory throughout the fiscal year: the organic decline falls from 5.9% in the first half to 1.3% in the second half. Revenue comes in close to analysts' consensus, which anticipated €9.48 billion.
Current Net Income Down 19%, Operating Margin at 25.8%
Current operating income amounts to €2,423 million, down 5.2% on an organic basis and 17.9% as reported, the latter incorporating a negative scope effect of €114 million and an unfavorable currency effect of €268 million. Operating margin stands at 25.8%, down 35 basis points on an organic basis, compared to 26.9% for fiscal year 2024/25 published on August 28, 2025.
The organic decline of 8.0% in structural costs, compared to 4% in 2024/25, reflects the implementation of the Fit for Future operating model. The €1 billion operational efficiency program was achieved half in this fiscal year, with full completion now expected in 2027/28.
Group current net income reaches €1,476 million, down 19%, and group net income €1,203 million, down 26%, due to an increase in non-current costs related to restructuring charges. Earnings per share decline 19%, to €5.85.
Free Cash Flow Up 6%, Dividend Maintained at €4.70 and Stability Target for 2026/27
Free cash flow increases by 6% compared to 2024/25, to €1,197 million, driven by cash conversion of 91%, up 17 percentage points. Investments were reduced, with capex brought down to €616 million. Net debt declines by €65 million compared to June 30, 2025, to €10,662 million, while the net debt to EBITDA ratio at average rates stands at 3.7x, reflecting the decline in current operating income.
A dividend of €4.70 per share is proposed, stable compared to 2024/25, subject to approval by the General Meeting on November 20, 2026. Shareholders will be able to receive the balance of €2.35 in cash or shares.
For 2026/27, the group anticipates globally stable organic revenue, with an expected decline in the United States and China and continued growth in the rest of the world. It targets maintaining cash conversion of approximately 90%, strategic investments of approximately €700 million and preservation of organic operating margin. Over the medium term (2026/27-2028/29), Pernod Ricard targets average organic growth close to the lower end of the 3% to 6% range and a net debt to EBITDA ratio below 3x by 2028/29.
