FY20 Q1 Sales

Q1: MODERATE GROWTH IN LINE WITH EXPECTATIONS, ON A VERY HIGH BASIS

OF COMPARISON (+10.4% IN Q1 FY19) ORGANIC SALES GROWTH: +1.3% (REPORTED: +4.0%)

 FY20 GUIDANCE¹ CONFIRMED: ORGANIC GROWTH IN PRO² BETWEEN +5% AND +7%

Sales for the first quarter of FY20 totalled ' 2,483 million, with organic growth of +1.3%:
'    Good start in USA: +6%
Thanks in particular to innovation, enhanced by advance shipments
'    China: +6% and India: +3%
Good growth on a very high comparison basis 
'    Global Travel Retail: -6%
Following very strong Q1 FY19
'    Good growth in Europe: +3%
Thanks to strong Sales in Eastern Europe and return to growth in Western Europe

Reported growth was +4.0% due to a favourable FX impact, mainly from US Dollar. For full-year FY20, a significantly positive FX impact on PRO2 is expected³. 

By category, growth was driven by:
'    Strategic International Brands: +3%, with growth moderation due to high comparison basis on Martell and Scotch but acceleration of Jameson, Beefeater, Malibu and Havana Club
'    Strategic Local Brands: +2%, with softer growth due to very high Q1 FY19 for Seagram's Indian whiskies
'    Specialty Brands: +15%, continued very dynamic performance, particularly for Lillet, Monkey 47, Del Maguey and Altos
'    Strategic Wines: -2%, modest decline linked to continued implementation of value strategy on Jacob's Creek 
'    Pricing: +2% on Strategic brands

As part of this communication, Alexandre Ricard, Chairman and Chief Executive Officer, stated, 'Q1 growth was moderate, as expected.  In an environment that remains particularly uncertain, we confirm our FY20 guidance of organic growth in Profit from Recurring Operations of between +5% and +7%.'

Pernod Ricard also clarified it intends to sign an agreement with an investment services provider, to implement a first tranche of the share buy-back programme announced on 29 August 2019 (of up to '1bn in total), according to which:
'    Pernod Ricard will undertake to acquire its own shares for a maximum amount of '150m.
'    The purchase period shall start on October 18, 2019 and end on December 18, 2019 latest.
'    The price shall not exceed the maximum price as set by the 12th resolution of the Ordinary Shareholders' Meeting of November 21, 2018.
'    Repurchased shares will be cancelled.

¹Guidance communicated 29 August 2019

²PRO = Profit from Recurring Operations

³Based on average FX rates projected at 1 October 2019, particularly a EUR/USD rate of 1.09
 

All growth data specified in this press release refers to organic growth (at constant FX and Group structure), unless otherwise stated. Data may be subject to rounding.

A detailed presentation of Sales for the first quarter of FY20 can be downloaded from our website: www.pernod-ricard.com 

Definitions and reconciliation of non-IFRS measures to IFRS measures
Pernod Ricard's management process is based on the following non-IFRS measures which are chosen for planning and reporting. The Group's management believes these measures provide valuable additional information for users of the financial statements in understanding the Group's performance. These non-IFRS measures should be considered as complementary to the comparable IFRS measures and reported movements therein.
 
Organic growth
Organic growth is calculated after excluding the impacts of exchange rate movements and acquisitions and disposals. 
Exchange rates impact is calculated by translating the current year results at the prior year's exchange rates.
For acquisitions in the current year, the post-acquisition results are excluded from the organic movement calculations. For acquisitions in the prior year, post-acquisition results are included in the prior year but are included in the organic movement calculation from the anniversary of the acquisition date in the current year.
Where a business, brand, brand distribution right or agency agreement was disposed of, or terminated, in the prior year, the Group, in the organic movement calculations, excludes the results for that business from the prior year. For disposals or terminations in the current year, the Group excludes the results for that business from the prior year from the date of the disposal or termination.
This measure enables to focus on the performance of the business which is common to both years and which represents those measures that local managers are most directly able to influence.

Profit from recurring operations 
Profit from recurring operations corresponds to the operating profit excluding other non-current operating income and expenses.