Pernod Ricard Eyes Cost Savings as Sales, Profit Drop

By Joshua Kirby

Pernod Ricard said it is focused on cost-control after weakening sales and rising costs bit into the distiller's earnings.

Recurring operating profit for the French group's fiscal first half through December dropped 19% on year, including currency effects, to 1.61 billion euros ($1.90 billion), Pernod said in a release Thursday. Profitability was hit by trade tariffs and cost inflation, with the operating margin contracting to 30.7% from 32.1% in the same period the previous fiscal year.

Sales continued their downward trajectory, with the key U.S. and China markets weighing on the group's overall top line. American consumers spent 15% less over the first half, Pernod said, pointing to a gloomy market for spirits.

In China, meanwhile, sales dropped by an even sharper 28%. Tougher regulation restrained sales of high-end spirits at bars and restaurants sales, while general consumer weakness also hit revenue, Pernod said. Still, some brands, including Absolut vodka and Jameson whiskey, booked good growth in China over the period, the company said.

Pernod is focused on boosting cash generation and cutting costs through efficiency measures, Chief Executive Alexandre Ricard said. For the remainder of the fiscal year, Pernod said it expects improving trends in sales, but noted that fiscal 2026 will be a "transition year."

"We will defend our organic operating margin to the fullest extent possible, supported by strict cost control," the company said.

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

(END) Dow Jones Newswires

February 19, 2026 01:44 ET (06:44 GMT)