Pernod Ricard Hopeful on Full Year Despite Falling Sales

By Joshua Kirby

French distiller Pernod Ricard remains upbeat that sales will improve this fiscal year, despite a tough first quarter as drinkers proved restrained in the key U.S. and China markets.

The producer of Absolut vodka and Martell cognac made sales of 2.38 billion euros ($2.77 billion) in the three months through September, the first quarter of the company's fiscal year. That represents an 8% drop from the same period last year, adjusted for currency effects, which had their own negative effect on the group's top line amid a stronger euro this year.

In the U.S., sales dropped 16%, partly as a result of inventory adjustments as sellers cleared out stock.

"The spirits market remained subdued," the company said.

The drop in demand was even clearer in China, key to Pernod Ricard's Asia division. Sales in China tumbled 27% as consumers stayed away from bars, hitting the on-trade business, with cognac sales notably depressed, the company said.

"We remain cautious on the demand environment ahead of the important Chinese New Year period," Pernod Ricard said.

Still, the company backed its hopes that sales trends will improve over the fiscal year as a whole, with the pickup skewed toward the second half. The company said it will defend its operating margin "to the fullest extent possible," while continuing to invest in its brands.

In the medium term, Pernod Ricard aims for growth of 3%-6% in sales a year, and growing profitability based on operational efficiencies.

Write to Joshua Kirby at joshua.kirby@wsj.com; @joshualeokirby

(END) Dow Jones Newswires

October 16, 2025 01:49 ET (05:49 GMT)