UPDATE: Pernod Ricard Raises Annual Profit Guidance

22nd Jul 2010 17:22

(Adds detail.) By Michael Carolan Of DOW JONES NEWSWIRES LONDON (Dow Jones)--Pernod Ricard SA (RI.FR) again raised its full-year profit guidance Thursday as a gradual recovery in mature markets combined with a strong performance in Latin America and Asia drove the French wine and spirits company's fourth-quarter sales higher. The maker of Chivas Regal whisky and Beefeater gin said organic sales in the fourth quarter grew 3%, following a 16% rise in the previous quarter. A slowdown in sales growth was expected as the third quarter benefitted from a number of one-off items such as the absence of last year's destocking, an earlier Easter and late Chinese New Year celebrations. The world's second-biggest drinks company by volume after U.K.-based Diageo PLC (DEO), raised its target for organic operating profit growth to between 3% and 4%, despite increasing advertising and promotional spend during the period. In April, Pernod raised its full-year organic operating profit growth guidance to 3% from a previous range of between 1% and 3%. The company said that organic sales growth for the year to June 30 reached 2%. Total sales, however, declined 2% due to a negative foreign exchange effect and the disposal of the Wild Turkey and Tia Maria brands. Organic sales growth was entirely driven by a 9% rise in the second half. The company cited "a gradual recovery in consumer spending in mature markets" and "higher growth momentum in emerging markets." Pernod said its Asian and Latin American markets had remained "very buoyant", while "the improved trend was confirmed in Eastern Europe, the U.S. and Duty Free markets." In Western Europe, however, sales continued to decline, particularly in Spain, the U.K. and Greece. Earlier Thursday, Pernod sold its Spanish wine brands Marques de Arienzo and Vina Eguia to a consortium of buyers for EUR28 million. Pernod reports full-year profit numbers on Sept. 2. -By Michael Carolan, Dow Jones Newswires; 44-20-7842-9278; [email protected] (END) Dow Jones Newswires July 22, 2010 12:22 ET (16:22 GMT)