(Adds details)
By Dominique Vidalon
PARIS, Sept 2 (Reuters) - French spirits maker Pernod Ricard
said it has written off 1 billion euros ($1.19
billion) in the full financial year 2019/20, as the shutdown of
bars and restaurants in most of its markets due to the pandemic
hit the company's sales and profit.
For the year ahead, the owner of Mumm champagne, Absolut
vodka and Martell cognac, predicted a prolonged downturn in
travel retail but sees resilience in sales to supermarkets in
the United States and Europe and a sequential improvement in
China and India.
"For 2021 Pernod Ricard expects continued uncertainty and
volatility, in particular relating to sanitary conditions and
their impact on social gatherings, as well as challenging
economic conditions" Chairman and CEO Alexandre Ricard said in a
statement.
Pernod Ricard, the world's largest spirits maker after
Diageo, said profit from recurring operations fell 13.7%
on an organic basis to 2.260 billion euros ($2.69 billion) in
the year ended June 30.
This compared with the company's July revised guidance for a
15% decline.
The resilient performance reflected tight cost control and
better-than-expected spirits sales to supermarkets in the United
States and Europe during the fourth quarter.
Pernod Ricard's 1 billion euro impairment charge mostly
related to Absolut vodka follows those of other alcoholic
beverage makers, Diageo, AB InBev and Heineken
. It led to a 77% fall in net profit to 329 million
euros in the full year.
Over the twelve months to June 30, sales fell 9.5% to 8.448
billion euros, reflecting notably a 27% fall in global travel
retail sales and a 16% fall in China sales.
In China, which makes 9% of group sales and is the group's
second largest market after the United States, the closure of
bars and restaurants from January hit Chivas Regal and Martell
cognac sales. Trends were, however, improving in the fourth
quarter from the third quarter with the gradual reopening of
bars and restaurants.
($1 = 0.8401 euros)
(Reporting by Dominique Vidalon; Editing by Shailesh Kuber and
Louise Heavens)
Diageo (DGE)
