Pernod Ricard travel retail sales drop -64% in Q1 FY21; DF&TR still in decline

By Andrew Pentol |

Alexandre Ricard, Chairman and Chief Executive Officer, Pernod Ricard.

Pernod Ricard has reported a -64% drop in travel retail sales during the first quarter of FY21 to 30 September 2020, versus the fourth quarter of FY20.

According to the company, travel retail remains in ‘very significant decline’ despite domestic travel resuming in some locations. The continued decline is because passenger traffic remains significantly down versus pre-Covid-19 levels.

Sales of Strategic International brands dropped -10% in the first quarter, with significant declines for Martell, Chivas and Ballantine’s, due mostly to travel retail. The continued strong growth of Malibu and The Glenlivet and the resilience of Jameson were bright sparks.

Despite the negatives in terms of DF&TR performance, Pernod highlights the positive impact of Hainan Island in China being open to duty free spirits sales.

Meanwhile, overall organic Pernod Ricard sales fell -10% year-on-year (-6%  organically) to €2.236 million/$2.643 million in the first quarter of FY2021. Pernod says that the off-trade remains very resilient in the USA and Europe and that the company has benefited from the partial on-trade re-opening.


From a geographic perspective, Pernod has reported a ‘good start’ in the USA and China, with strong shipments ahead of the festive season. It also revealed a double-digit decline in India and ‘good resilience’ in Europe. The latter was thanks to strong dynamism in the UK and Germany and near stability in France. Spain and Russia experienced declines.

Overall organic Pernod Ricard sales fell -10% year-on-year (-6% organically) to €2.236 million in the first quarter of FY21.

On the category front, sales of Strategic Local brands fell -6%. Sales of Seagram’s Indian whiskies declined, while Kahula, Passport, Ramazzotti and Wiser’s experienced double-digit growth.

Speciality brand sales rose +30%, driven by Lillet, Malfy, Aberlour, Avion, Altos and Monkey 47. Strategic Wines were up +9%, courtesy of double-digit growth from Campo Viejo and Brancott Estate. Jacob’s Creek grew +8%.

Reported Sales declined -10% due to unfavourable FX impacts, mainly from the US Dollar and emerging market currencies.

Looking ahead to the remainder of FY2021, Pernod expects continued uncertainty and volatility relating to sanitary conditions and their impact on social gatherings and travel. It also anticipated challenging economic conditions and the off-trade in the USA and Europe to be resilient.

It is also expecting a prolonged downturn in travel retail and on-trade disruption, along with a return to growth in China and gradual improvement in India.

In announcing its FY21 Q1 results, Pernod Ricard has reported ‘good resilience’ in Europe. Source: Pernod Ricard

The second quarter is still expected to be strongly impacted by Covid-19, but Pernod believes sales could return to growth in the second half of FY21

Implementing a clear strategy, accelerating digital transformation and strict cost discipline with the agility to reinvest, are key focuses moving forward.

Alexandre Ricard, Chairman and Chief Executive Officer, Pernod Ricard said: “Our first quarter is encouraging. Sales were still in decline, but the business has recovered significantly versus Q4 FY20, thanks to the partial reopening of the on-trade and the strong resilience of our brands in the off-trade.

“For FY21, we expect continued resilience of our business in an uncertain and disrupted environment. I would like to take this opportunity to praise our teams, whose engagement and performance are exemplary in these very challenging times.

“We will continue to implement our strategy, in particular accelerating our digital transformation. We will tightly manage costs while maintaining the agility to reinvest to adjust to market opportunities.”

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