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Rémy Cointreau sales under ‘intense pressure’
Times are difficult for Rémy Cointreau but at least its third-quarter sales figures were not as bad as investors and analysts expected. Sales were €787 million, a fall of 17.7% on an organic basis compared with 2023. Some had expected a 20% drop.
Sales in the three months to Christmas were not as dismal as predicted thanks to a significantly better-than-projected performance in Cognac, which accounts for about 70% of the group’s sales.
Nevertheless, for the third time since October, the French group warned that sales for the rest of its financial year to the end of March remain under intense pressure.
“Trends in the fourth quarter will be decisive,” it said in a statement which referred to “persistent lack of visibility on the timing of the recovery in the United States and worsening market conditions in China”.
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The company spoke of a “marked decline” in China where its Rémy Martin brand is the Cognac sector leader. It also underlined a “strong drop” in the Americas.
The threat of tariffs
Added to that Rémy extra uncertainty because of the threatened imposition of tariff barriers in both China and the United States, its two biggest markets.
Consequently, although it repeated its prediction that sales in the full year to the end of March would fall by between 15% and 18%, it hinted that the outcome could be “close to” an 18% drop compared with last year.
On the financial side Rémy Cointreau said that in the “worsening economic environment” its is determined to protect as much of its current operating margin through tight financial controls and the introduction of a new plan to save up to €50 million a year.
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