Last year Pernod recorded a 1% drop for FY24 and of the H1 FY25 sales, which totalled just under €6.2bn, Martell cognac accounted for the majority of Pernod’s decline due to issues in China and travel retail.
In a statement released by Pernod, it gave a medium forecast which read: “Ongoing challenging macroeconomic environment and intense geopolitical uncertainties continue to impact the spirits market, particularly the worsening context in China and travel retail Asia, notably impacting Martell. This leads us to revisit our outlook for FY25 and beyond.
“Conditional on the challenges posed by the global tariff environment, FY26 is expected to be a transition year with improving trends in organic net sales. Amid extraordinary trade tensions, we are focused on defending organic operating margin to the fullest extent possible.
“From FY27 to FY29, projecting stronger organic net sales growth, aiming for a range, on average of +3% to +6%, accompanied with organic operating margin expansion.”
The statement continued: “Delivering continuing efficiency initiatives that optimize Operations and simplify the organisational structure, expected to deliver c.€1bn in efficiencies from FY26 to FY29.
“Throughout these periods we aim to maintain consistent investments behind our brands with c.16% A&P/NS, with agility and responsiveness to maximise opportunity by brand and market.
“Focusing on strong cash generation aiming for c.80% and above cash conversion, to fund our financial policy priorities, with strategic investments normalizing to c. €1bn from FY26.
“We are confident in our strategy, in our operating model’s ability to deliver and in the engagement of our teams. We are determined to navigate with agility these cyclical headwinds.”
