Pernod Ricard reports 5.9% sales decline in Q1 FY 25 amid challenges in China, U.S. 

FRANCE – Pernod Ricard SA, a leading global spirits and wine company, has reported weaker-than-expected sales in its first fiscal quarter of FY 2025.  

The company attributed the decline to sluggish consumer demand in China and ongoing challenges in the U.S., where retailers and wholesalers continued cutting back on pricier spirits.  

Sales in China also affected Asia’s travel retail segment, further impacting overall performance. 

For the fiscal quarter, Pernod Ricard’s sales dropped by 5.9 percent on an organic basis to €2.78 billion (US$3B), falling short of analyst expectations, which had forecasted sales of €2.84 billion (US$3.1B).  

The sales decline is reflective of the broader difficulties premium liquor producers are facing in China, as the country grapples with a real estate crisis, which has weakened consumer demand. 

Additionally, Pernod and its competitor Remy Cointreau have been affected by recent anti-dumping measures imposed by China on European brandy imports.  

This move followed the European Union’s decision to place tariffs on Chinese electric vehicle imports for five years.  

Pernod Ricard reported that its China sales had dropped by 26 percent during the period and acknowledged that these factors would likely result in a full-year decline greater than that of the previous year. 

Pernod Ricard also cited some resilience in other markets, including travel retail in the Americas and Europe, along with growth in Japan, Canada, Poland, Brazil, Turkey, and Nigeria.  

However, sales in the Americas fell by 5 percent, with the U.S. market experiencing a 10 percent year-on-year decline.  

Europe saw a 3 percent plunge in sales, while sales in the Asia/Rest of the World region fell by 8 percent, primarily driven by the 26 percent drop in China. 

The company’s strategic international brands, such as Martell in China, Royal Salute in Korea, and The Glenlivet in the U.S., saw a 10 percent decrease in sales. 

Despite the current challenges, Pernod Ricard remains optimistic, reiterating its medium-term goal of achieving organic net sales growth between 4 percent and 7 percent.  

The company expects a recovery in sales and continued improvement in operating margins for the full year. 

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