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Russian exit sees mixed results for Chivas Brothers

02 September 2024 By Louis Thomas

Pernod Ricard-owned Chivas Brothers has reported a -1.6% year-on-year dip in net sales in its FY24 results, with the Scotch whisky company attributing the slight downturn to the suspension of trading in Russia.

According to the results released by Chivas Brothers, which oversees brands including Chivas Regal, Ballantine’s, Royal Salute and The Glenlivet, FY24 was very much a year of two halves, with H1 (July to December 2023) marked by a decline of -6% before things rebounded in H2 (January to June 2024) by +5%.

Chivas Brothers attributes the overall decline to Pernod Ricard ceasing all exports of its international brands to Russia in April 2023, and the results state that, excluding this market, net sales for FY24 were +1.4% up year-on-year. Indeed, the -25% decline in sales in Eastern Europe actually becomes +8% if Russia is excluded.

Jean-Etienne Gourgues, chairman and CEO of Chivas Brothers, told the drinks business that, in spite of the loss of the Russian market, the company is prepared to deal with such challenges.

“Inevitably, Pernod Ricard’s decision to stop all exports of its international brands to Russia, including our Scotch whisky portfolio, had an impact on FY24 performance for us at Chivas Brothers. With its broad geographical footprint, our business is well set up to weather planned and unplanned volatility, enabling us to maintain a resilient and stable growth trajectory in spite of geopolitical complexities. Whisky is and always will be a long-term game and with a +12% CAGR since FY21, our eyes are fixed on the future. Our return to growth in H2 has set a good level of confidence as we enter in this new fiscal.”

The Americas saw a notable downturn, with sales in Central and South America dropping by -8%, and those in North America dropping by more than double that, with a -19% decline recorded.

One “star performer in the Asian region” was Japan, with sales 22% up on FY23 – Gourgues revealed that this significant growth was underpinned by “Chivas Regal and Ballantine’s core range”.

There were also very positive signs in Western Europe, which was up +5% overall.

“We’re pleased to see growth in both our mature and emerging markets, as we open up the industry and welcome new Scotch whisky drinkers. In Western Europe, France (+1%) and Germany (+37%) were the key markets driving growth, with Ballantine’s and Chivas Regal responsible for helping France get back to growth. The German market saw strong performances across all Chivas Brothers’ blended Scotch brands, as well as Aberlour single malt.”

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