French distiller Remy Cointreau SA reported higher sales in its fourth quarter as cognac revenue rebounded in China even as US consumption slowed.
(Bloomberg) — French distiller Remy Cointreau SA reported higher sales in its fourth quarter as cognac revenue rebounded in China even as US consumption slowed.
The Paris-based company reiterated its full-year guidance for the fiscal year that ended March 31. For the current year that began in April, Remy sees revenue remaining stable on an organic basis. It added, however, that US sales are expected to fall sharply in the first half, and then rebound strongly in the second.
The results underscore slowing US demand for premium spirits amid high inflation and economic uncertainty. At the same time, drink makers expect the key Chinese market to keep recovering after the country re-opened following the end of strict Covid-Zero policies.
Consumption of premium spirits, particularly cognac, surged during the pandemic as drinkers in the US and Europe upgraded their high-end booze consumption at home. Now US-driven demand is “normalizing,” Remy said Friday, but will remain above 2019 levels.
Organic sales rose by 10.2% in the fourth quarter, Remy said in a statement Friday. Analysts were expecting growth of about 9.5%, according to consensus estimates compiled by Bloomberg.
The maker of Remy Martin cognac said fourth-quarter cognac sales rose 2.9% as US consumption returned to more normal levels. Fourth-quarter liquor and spirits sales rose by 26.2%, driven by strong performance of its pricey booze brands in the US and Europe, the company said.
(Updates to add more information about 2023-24 forecast in second paragraph)
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