Pernod Ricard's Shares Rise on Positive Guidance in US and China

By Andrea Figueras

Shares in Pernod Ricard climbed on Thursday after the French drinks company confirmed its growth targets for the upcoming year despite a decline in sales in the first quarter.

At 0831 GMT shares traded 4.7% higher at EUR166.10.

The group posted sales of 3.04 billion euros ($3.20 billion) for the first quarter of fiscal 2024 ended in September, down 8% on the year in reported terms and 2% organically, on the back of expected declines in the Americas and China.

While first-quarter results came in-line with expectations, the company remains confident that sales momentum will improve through fiscal 2024 with positive organic sales growth in both the U.S. and China, Citi analysts said in a research note.

"We expect little change to consensus estimates today and that investor focus will be on management comments on Mid-Autumn Festival off-take trends and wholesaler stock levels in China and whether U.S. inventory adjustments are complete," Citi added.

Incremental colour around a positive outlook in the U.S. and China and strong growth in travel retail and India should be well-received, as it implies U.S. and China accelerating to at least 3% for the remainder of the fiscal year, Jefferies analysts Edward Mundy and Andrei Andon-Ionita said in a research note.

"This should be enough for gentle outperformance today," Jefferies said.

Write to Andrea Figueras at andrea.figueras@wsj.com

(END) Dow Jones Newswires

October 19, 2023 05:31 ET (09:31 GMT)

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