Remy Cointreau Says US Cognac Demand Is Returning to Normal

Remy Cointreau SA said US demand for high-end drinks is on track to recover later this year as it reiterated that it expects stable annual sales growth.

(Bloomberg) — Remy Cointreau SA said US demand for high-end drinks is on track to recover later this year as it reiterated that it expects stable annual sales growth.

The French spirits maker said sales fell 35% on an organic basis to €257.5 million ($285.4 million), as expected, with US consumption of cognac dropping to more normal levels following a boom in 2022.

The sales drop matched analyst consensus estimates.

Remy stock rose nearly 8% in early trading.

The company said sales in the Asia Pacific region — including China — rose steeply, without providing specific increases. It maintained its annual forecast of stable organic sales growth — with a strong decline in the first half offset by a US recovery that will begin in the third quarter. There will also be a continued comeback in China, it said.

First quarter sales were no worse than expected and China is booming and inventories are sound, Jefferies analyst Edward Mundy, said in a note to clients. Mundy added that the long-term story for Remy remains attractive as cognac is one of the most attractive spirits categories.

(Updates with shares and analyst comments starting from third paragraph)

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