Remy Cointreau confident on year after Q2 sales beat expectations

By Dominique Vidalon

PARIS, Oct 25 (Reuters) – Remy Cointreau RCOP.PAsaid it was looking to the 2022/2023 full year with confidence after its sales rose by a stronger-than-expected 16.2% in the second quarter, boosted by a recovery in demand for its premium cognac in the China.

Remy Cointreau reiterated it expected another year of strong organic sales growth and of operating margin improvement helped by strict costs control to mitigate inflationary pressures.

The pandemic has helped Remy Cointreau’s long-term drive towards higher-priced spirits to boost profit margins, speeding a shift towards premium drinks, at-home consumption, cocktails and e-commerce.

“Ideally positioned to take advantage of new consumption trends and buoyed by its advance on roll-out of its strategic plan, Remy Cointreau is looking to 2022/23 with confidence,” the company said in a statement.

It noted the first half would outpace the second half as consumption trends will normalise in the latter half after two outstanding years while marketing and communication spending will be more sustained in the second half.

Sales for the three months to September 30 came in at 457.2 million euros ($451.4 million), marking a like-for-like rise of 16.2% which beat analysts’ expectations for 14.3% growth.

Cognac sales rose 15.6% to 345.9 million euros reflecting a very strong performance in China during the Mid-Autumn Festival.

Remy Cointreau’s fiscal year starts on April 1 and ends on March 31.

For the full year Remy forecast a positive currency effect with reported sales now seen at 110-120 million euros compared with 90-100 million previously, and current operating profit at 55-60 million compared with 50-60 million.

($1 = 1.0129 euros)

(Reporting by Dominique Vidalon; editing by Sudip Kar-Gupta and Jason Neely)

((dominique.vidalon@thomsonreuters.com; +33149495432; Reuters Messaging: dominique.vidalon.reuters.com@reuters.net))

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