Weak Chinese and US markets weigh on Pernod Ricard Q1 sales

By Dominique Vidalon PARIS (Reuters) -French spirits maker Pernod Ricard said it still expected sales to improve in fiscal year 2026 after reporting a well-flagged 7.6% fall in first quarter sales, due to weak consumer demand and destocking in China and the United States. Pernod, the world's second-biggest Western spirits group behind Diageo, said it continued to expect the improving sales trends to be skewed towards the second half of the year. The owner of Martell cognac, Mumm champagne and Absolut vodka – reported sales of 2.384 billion euros ($2.78 billion) from July to September, marking a like-for-like decline of 7.6%, compared to a company-compiled analyst consensus for a decline of 7.1%. Pernod Ricard's fiscal year started on July 1. Pernod Ricard and its rivals have suffered amid falling sales and tariff uncertainty in the key markets of China and the United States. Tariff deals were reached in July. In the United States, where tariff uncertainty led distributors to boost inventory levels at the end of fiscal year 2025, adjustments continued in the quarter, with sales falling 16%. In China, sales fell 27% as consumer demand stayed soft over the summer and into the Mid-Autumn Festival. Cognac sales remained depressed but the group's premium brands continued to grow in the quarter, notably Jameson whiskey. Pernod Ricard said it remained cautious on demand in China ahead of the important Chinese New Year festive period that starts in mid-February. Pernod – which has launched a restructuring plan to cut costs – reiterated its guidance for between 3% and 6% annual organic sales growth for 2027-2029, along with annual organic margin expansion. ($1 = 0.8579 euros) (Reporting by Dominique Vidalon; Editing by Ronojoy Mazumdar)

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