Jameson-maker Pernod Ricard delivers better-than-expected sales                  

RBC analysts said in a research note: "US organic sales growth of 2% is somewhat concerning...it seems that the US market is slowing"

The company said that sales of its so-called strategic international brands were up 12% due to "very dynamic growth driven mainly by Scotch, Jameson, Absolut, Beefeater and Martell".

Jameson Whiskey-maker Pernod Ricard has said it was confident sales growth would remain dynamic through its 2023 financial year after it delivered forecast-beating sales in the first quarter helped by price increases as consumers trade up to its premium spirits.

Pernod, the world's second-biggest spirits group behind Diageo, successfully raised prices in the US, its top market, in the quarter while demand was strong in China during the Mid-Autumn festival and in India and a rebound in global travel retail continued.

"I am hugely encouraged by our start to the year," chairman and chief executive Alexandre Ricard said in a statement.

In an environment that remained volatile with high inflation, the war in Ukraine, and Covid-19 lockdowns in some Chinese cities, the group said it expected sales growth for the full year would remain "dynamic and broad-based, albeit moderating on a normalising comparison basis,"

It, however, did not provide a quantitative guidance for the full year. Pernod Ricard shares fell by 1% in the latest session. 

RBC analysts said in a research note the quarterly performance was "good" but noted that: "US organic sales growth of 2% is somewhat concerning...it seems that the US market is slowing". Pernod Ricard's financial year started on July 1.

For the first quarter ended September 30, Pernod - which also owns Martell cognac, Mumm champagne and Absolut vodka - reported sales of €3.3bn, a like-for-like rise of 11%, which came above market expectations for a 9.3% sales rise.

In China alone, sales rose 9% in the first quarter thanks to strong mid-Autumn festival sales. The Martell cognac brand recorded double-digit sales growth during the quarter despite covid restrictions.

Sales in global travel retail rose 24% in the first quarter as it continued its recovery outside of China and was on track to deliver profit back to pre-covid levels, the group said. 

The company said that sales of its so-called strategic international brands were up 12% due to "very dynamic growth driven mainly by Scotch, Jameson, Absolut, Beefeater and Martell".

Sales of its local brands were up 13% "mainly driven by strong double-digit growth of Seagram’s whiskies," it said.  And sales of its specialty brands were up 16% after "continued excellent development driven by Lillet, Malfy, Redbreast, and Jefferson’s," it said. 

Reuters. Additional reporting Bloomberg