Published On 02/09/2017

2016/17 Half-year Sales and Results

Press release - Paris, 9 February 2017











Sales for H1 17 totalled €5,061m. Organic Sales growth was +4%, representing a continued improvement vs. FY 16. Reported Sales growth was +2% with an unfavourable FX impact.

The continued improvement, was driven by:

Strong growth continuing in USA, for Jameson worldwide and innovation

Improvement vs. FY16 in China, Travel Retail and Russia, as well as for Absolut, Martell and Chivas

• … Despite the temporary adverse impact of demonetisation leading to growth deceleration in India

Sales growth was +3%, restated for earlier CNY [1].

The Group continued to consistently implement its mid-term strategy:

• Following changes, the new organisations are getting up to speed in USA, Global Travel Retail and China

• The brand portfolio is continuing to be actively managed, with the acquisition of a majoritystake in Smooth Ambler and the disposal of Domecq brandies and wines

Innovation is contributing 1% to overall growth, driven by Jameson Caskmates, Lillet and Olmeca Altos

Q2 17 Sales were €2,813m, +4% organic growth, in continuity of Q1. Q2 reported Sales growth was +3%.



H1 17 PRO was €1,500m, with organic growth of +4% (+3% adjusted for CNY [1]) and +4% reported:

Gross margin down -31bps:

  • Price/mix turning positive but pricing remaining subdued
  • Tight management of costings

Sustained investment in A&P: +1% to support key initiatives

The Operational efficiency implementation is on track with the 2020 roadmap [2] covering manufacturing, procurement, A&P and supply chain.

Financial expenses from recurring operations were down €16m thanks to the average cost of debt reducing from 4.2% to 4.0% in H1 17. For full-year FY17, the cost of debt is expected to be 3.8%.

The tax rate on recurring operations was 25.7% in H1, close to the c. 26% expected for FY17.

Reported Group share of Net Profit from Recurring Operations was €957m, +5% vs. H1 16.

Reported Group share of Net profit was €914m, +3% vs. H1 16.



Cash generation was very strong, with Free Cash Flow of €658m, +34% vs. H1 16, partly enhanced by phasing.

Net debt increased by €237m to €8,953m mainly driven by an adverse translation adjustment on USD-denominated debt (EUR/USD parity on 30 June 2016 at 1.11 vs. 31 December 2016 at 1.05.)

The Net debt / Ebitda ratio at average rates decreased to <3.4, an improvement vs. both   31/12/15 (<3.6) and 30/06/16 (3.4), in spite of adverse cash seasonality.


As part of this communication, Alexandre Ricard, Chairman and Chief Executive Officer, declared,

Our half-year results are strong, delivering a continued performance improvement.  Our strategy remains consistent and is driving results.

For full year FY 17, in an uncertain environment, we plan to continue improving our business performance year-on-year vs. FY 16.  We will continue to support priority markets, brands and innovations while focusing on operational excellence.  We expect to deliver organic growth in Profit from Recurring Operations in line with the guidance of +2% to +4% [3].”

All growth data specified in this presentation refers to organic growth, unless otherwise stated.  Data may be subject to rounding.



[1]Chinese New Year (“CNY”) on 28 January 2017 vs. 8 February 2016

[2]Initiatives to contribute over the period FY16 to FY20 total P&L savings of c. €200m, of which around half will be reinvested in A&P, and cash savings of c. €200m

[3]Over the full FY17, the FX impact on PRO is estimated at approximately +€ 80m, based on average FX rates for full FY 17 projected on 31 January 2017 , particularly a EUR/USD rate of 1.09



All growth data specified in this presentation refers to organic growth, unless otherwise stated.  Data may be subject to rounding. A detailed presentation of H1 17 Sales and Results can be downloaded from our website: . Limited audit procedures have been carried out on the half-year financial statements. The Auditors’ report on their limited review is being prepared and will be available on our website.

Definitions and reconciliation of non-IFRS measures to IFRS measures

Pernod Ricard’s management process is based on the following non-IFRS measures which are chosen for planning and reporting. The Group’s management believes these measures provide valuable additional information for users of the financial statements in understanding the Group’s performance. These non-IFRS measures should be considered as complementary to the comparable IFRS measures and reported movements therein.

Organic growth

Organic growth is calculated after excluding the impacts of exchange rate movements and acquisitions and disposals.

Exchange rates impact is calculated by translating the current year results at the prior year’s exchange rates.

For acquisitions in the current year, the post-acquisition results are excluded from the organic movement calculations. For acquisitions in the prior year, post-acquisition results are included in the prior year but are included in the organic movement calculation from the anniversary of the acquisition date in the current year.

Where a business, brand, brand distribution right or agency agreement was disposed of, or terminated, in the prior year, the Group, in the organic movement calculations, excludes the results for that business from the prior year. For disposals or terminations in the current year, the Group excludes the results for that business from the prior year from the date of the disposal or termination.

This measure enables to focus on the performance of the business which is common to both years and which represents those measures that local managers are most directly able to influence.

Free cash flow

Free cash flow comprises the net cash flow from operating activities excluding the contributions to Allied Domecq pension plans, aggregated with the proceeds from disposals of property, plant and equipment and intangible assets and after deduction of the capital expenditures.

“Recurring” indicators

The following 3 measures represent key indicators for the measurement of the recurring performance of the business, excluding significant items that, because of their nature and their unusual occurrence, cannot be considered as inherent to the recurring performance of the Group:

  • Recurring free cash flow

Recurring free cash flow is calculated by restating free cash flow from non-recurring items.

  • Profit from recurring operations

Profit from recurring operations corresponds to the operating profit excluding other non-current operating income and expenses.

  • Group share of net profit from recurring operations

Group share of net profit from recurring operations corresponds to the Group share of net profit excluding other non-current operating income and expenses, non-recurring financial items and corporate income tax on non-recurring items.

Net debt

Net debt, as defined and used by the Group, corresponds to total gross debt (translated at the closing rate), including fair value and net foreign currency assets hedging derivatives (hedging of net investments and similar), less cash and cash equivalents.


EBITDA stands for “earnings before interest, taxes, depreciation and amortization”. EBITDA is an accounting measure calculated using the Group's profit from recurring operations excluding depreciation and amortization on operating fixed assets.


Have a look at the HY 16/17 performance highlights:

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About Pernod Ricard

Pernod Ricard is the No.2 worldwide producer of wines and spirits with consolidated sales of €9,182 million in FY19. Created in 1975 by the merger of Ricard and Pernod, the Group has developed through organic growth and acquisitions: Seagram (2001), Allied Domecq (2005) and Vin&Sprit (2008). Pernod Ricard, which owns 16 of the Top 100 Spirits Brands, holds one of the most prestigious and comprehensive brand portfolios in the industry, including: Absolut Vodka, Ricard pastis, Ballantine’s, Chivas Regal, Royal Salute, and The Glenlivet Scotch whiskies, Jameson Irish whiskey, Martell cognac, Havana Club rum, Beefeater gin, Malibu liqueur, Mumm and Perrier-Jouët champagnes, as well Jacob’s Creek, Brancott Estate, Campo Viejo, and Kenwood wines. Pernod Ricard’s brands are distributed across 160+ markets and by its own salesforce in 73 markets. The Group’s decentralised organisation empowers its 19,000 employees to be true on-the-ground ambassadors of its vision of “Créateurs de Convivialité.” As reaffirmed by the Group’s three-year strategic plan, “Transform and Accelerate,” deployed in 2018, Pernod Ricard’s strategy focuses on investing in long-term, profitable growth for all stakeholders. The Group remains true to its three founding values: entrepreneurial spirit, mutual trust, and a strong sense of ethics. As illustrated by the 2030 roadmap supporting the United Nations Sustainable Development Goals (SDGs), “We bring good times from a good place.” In recognition of Pernod Ricard’s strong commitment to sustainable development and responsible consumption, it has received a Gold rating from Ecovadis and is ranked No. 1 in the beverage sector in Vigeo Eiris. Pernod Ricard is also a United Nation’s Global Compact LEAD company.
Pernod Ricard is listed on Euronext (Ticker: RI; ISIN Code: FR0000120693) and is part of the CAC 40 index.

Contacts Pernod Ricard

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