Pernod Ricard Cuts Guidance, Blaming Coronavirus

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02/13/2020 | 08:08 am
Alexandre Ricard

By Cristina Roca

Pernod Ricard SA on Thursday slashed its full-year guidance, saying that it expects the coronavirus outbreak to have a severe impact on its third fiscal quarter, even as it reported higher net profit and sales for the first half of its fiscal year.

The French premium spirits maker reported net profit of 1.03 billion euros ($1.12 billion), up from EUR1.02 billion a year earlier.

Pernod Ricard posted second-quarter sales of EUR2.99 billion, a rise of 4% on an organic basis, which strips out currency fluctuations and acquisitions. Sales for the first half rose to EUR5.47 billion from EUR5.19 billion previously.

Despite the rise in sales and earnings, the maker of Absolut vodka and Jameson whiskey said that it now expects lower organic growth in its underlying profit as it assumes the coronavirus to have a "severe" impact on its business, mainly on the third quarter. Pernod Ricard cut its guidance of organic growth in profit from recurring operation for fiscal 2020 to 2%-4%, from previous expectations of 5%-7%.

"We will stay the strategic course and maintain priority investments in order to continue maximising long-term value creation," Chairman and Chief Executive Alexandre Ricard said.

 

Write to Cristina Roca at cristina.roca@dowjones.com; @_cristinaroca

 

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