Brexit to add €30m to Pernod Ricard profits

Britain’s vote to leave the EU will add approximately €30 million to Pernod Ricard’s profits in its present financial year, according to Gilles Bogaert, the French group’s managing director of finance and operations.

Gilles Bogaert, Pernod Ricard’s managing director of finance and operations.

Speaking in London earlier today, he said that the Brexit vote and the subsequent slide of the pound against the euro would be “moderately positive”.

Shipments from its subsidiary, Chivas Bros, the second largest producer of Scotch whisky after Diageo, represent between 25% and 30% of Pernod Ricard’s total exports worldwide.

By comparison, the UK market represents just 2% of Pernod Ricard’s global consumer sales, so the extra cost of imported wines and spirits will be “net positive”, he said.

Bogaert declined to be drawn about the longer-term impact of Britain’s decision to leave the EU, saying the company was confident that whatever the outcome, “people the world over will continue to drink Scotch”.

Although the industry is anxious about the potential for some countries to raise tariff barriers once Britain ceases to be party to free trade agreements negotiated with them by Brussels, there is an underlying expectation that Scotch exports to the remaining 27 countries of the EU will be unhindered because they are covered by World Trade Organisation agreements.

Laurent Lacassagne, Chivas Bros, managing director, said the whisky company was not concerned “one way or the other” about a possible second independence referendum in Scotland. “We are where we are. We cannot make Scotch anywhere else,” he said.

He said that Chivas Bros had a number of working groups set up in advance to consider the potential of the 2014 referendum and that their contingency planning could be readily revived should there be a need to do so.