Whisky giant Pernod Ricard has said the Covid-19 coronavirus may not have as big an impact on the group’s profits as feared.
The company, whose whisky portfolio includes Ballantine’s and The Glenlivet, said strong off trade business in areas such as Western Europe had provided support amid the challenges posed by the Covid-19 pandemic.
This has taken a heavy toll on sales in key markets such as China and travel retail as expected by Pernod Ricard’s directors.In an update on trading Pernod Ricard said it expected profit from recurring operations to fall 15 per cent in the latest financial year, which ended on June 30.
In April, the company had forecast that profits would fall 20%.
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The company gave no details regarding whisky sales yesterday. However, whisky brands account for a significant share of its portfolio.
In its first half results announcement in February, Pernod Ricard included The Glenlivet and Ballantine’s whiskies in a list of international strategic brands which it said had achieved a dynamic performance. Others included Beefeater Gin and Martell cognac.
The April forecast was based on the assumption that there would be very limited business in China in that month with a slow recovery from April, and that travel retail business would fall by 80% from February to end June. Pernod Ricard predicted there would be no on-trade sales from mid-March to end June, as outlets were shut or not reordering.
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The company said yesterday that these assumptions had proved to be “directionally correct”. It said notable differences included “ more resilience in the Off-trade, especially in the USA and Western Europe”.
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