Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

High-end cognacs lift spirits at Remy Cointreau

Stock MarketsJan 25, 2022 05:50AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. FILE PHOTO: The logo of Remy Cointreau SA is pictured at their headquarters in Paris, France, January 21, 2019. REUTERS/Benoit Tessier

By Dominique Vidalon

PARIS (Reuters) -Remy Cointreau is confident demand for its premium cognac in China, the United States and Europe will underpin profit growth this year after the French spirits group beat third-quarter sales forecasts.

The maker of Remy Martin cognac and Cointreau liquor was slightly more cautious, however, on prospects for Chinese New Year celebrations next month due to COVID restrictions, and its shares reversed earlier gains to trade down 1.6% by midday.

"We are optimistic on Chinese New year but a little more cautious than we were two months ago. It will be a solid 2022 Chinese New Year though not the best ever for the industry," Finance Chief Luca Marotta told analysts.

Remy is banking on its Club cognac in particular to win market share in China, he added.

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

Group sales for the three months to Dec. 31 came in at 440.5 million euros ($498.1 million), an organic rise of 21%, beating a company-compiled consensus from 18 analysts for a 15.1% rise.

Sales at the Remy Martin cognac division, which makes 90% of group profits, rose 19.4% to 332.7 million euros, also above analysts' estimates of 14.9%.

The company said the third-quarter performance reflected double-digit sales growth in China, led by Club cognac and strong e-commerce sales during the Singles' Day online shopping bonanza.

Cognac demand in the United States also remained strong, with high-end brands such as Louis XIII cognac that sells for more than $2,000 a bottle, Remy Martin XO and 1738 Accor (PA:ACCP) Royal outperforming.

For the full 2021/22 year, Remy kept a forecast of "very strong" organic growth in current operating profit and strong organic sales growth, and reiterated it was confident in its ability to outperform the premium spirits market.

Marotta told analysts that consensus forecasts for 2021-22 organic current operating profit growth of 38% and sales growth of 26.5% were "at the right level".

Due to higher marketing and communication spending and a tougher comparison base in the second half, full-year profits will be driven solely by first-half growth, the group reiterated

The French company's fiscal year starts on April 1 and ends on March 31.

($1 = 0.8843 euros)

High-end cognacs lift spirits at Remy Cointreau
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email