Pernod Ricard to restructure global operations, create two brand divisions amid sales slowdown
The French spirits maker plans internal restructuring to boost agility and reduce costs as it battles declining sales in major markets.
FRANCE – Pernod Ricard has announced plans to restructure its global operations by grouping its portfolio into two main divisions as part of efforts to create a more streamlined and cost-efficient organisation.
The move comes amid a challenging global economic landscape, with declining sales in major markets such as China and the United States.
The French spirits giant, known for brands such as Absolut vodka and Martell cognac, confirmed to Reuters that it had launched an internal project aimed at simplifying operations and improving agility.
The restructuring initiative, named “Tomorrow 2,” is expected to affect administrative roles and result in voluntary departures, though the company has not disclosed specific job loss figures.
In a staff memo reviewed by Reuters, CEO Alexandre Ricard explained that the initiative seeks to reduce organisational complexity by bundling tasks currently managed individually by different brands.
In a related video message, Ricard acknowledged the restructuring would involve workforce reductions, though further details were not shared.
According to presentation materials seen by Reuters, the reorganisation will divide Pernod Ricard’s brands into two core business units—Gold and Crystal.
The Gold division will comprise premium offerings, including Martell cognac, Jameson Irish whiskey, and champagne labels.
The Crystal division will feature brands such as Absolut vodka, Havana Club rum, and French aperitifs.
The company plans to begin implementing the restructuring plan in the final quarter of 2025, subject to consultation with social partners and employees in local markets where necessary.
Pernod Ricard stated it will adhere to legal and procedural requirements in each affected country.
The restructuring aligns with the company’s previously announced plan to cut €1 billion in costs by its 2029 financial year. It also follows job cuts already initiated in China, where anti-dumping duties on French cognac have severely impacted Martell’s sales performance.
In its third-quarter financial results published in April, Pernod Ricard reported net sales of €2.38 billion (US$2.74B), reflecting a 3% decline on both an organic and reported basis.
For the first nine months of the financial year, net sales dropped by 4% organically and 3% in reported terms to €8.5 billion (US$9.8B), with a €145 million (US$167.1M) foreign exchange impact contributing to the downturn.
While the U.S. market saw a modest 2% rise in net sales for the third quarter, China recorded a 5% decline, and a 22% year-to-date drop. The company cited challenging macroeconomic conditions and trade tariffs as primary obstacles in the Chinese market.
Pernod Ricard’s Chief Financial Officer Hélène de Tissot noted the company is closely monitoring the tariff situation and remains confident in sustaining its operating margins despite the ongoing headwinds.
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