French spirits company Remy Cointreau achieved stronger-than-expected second quarter sales, helped by robust demand for its premium cognac in China, and it kept its forecast for higher profit growth this year.
The group, which makes Remy Martin cognac and Mount Gay rum, has focused on selling spirits priced at $50 a bottle or more as part of a strategy that has benefited from a rebound in Chinese demand as well as solid sales in the United States, its top market.
Sales Performance
Sales for the three months to 30 September came in at €329.8 million ($378 million), marking a like-for like rise of 9.1% that beat analysts' expectations of 7.8% growth in a company compiled consensus of analysts.
This compared with like-for-like sales growth of 5.9% in the first quarter.
Sales of Remy Martin cognac, which account for about 71% of group sales, rose 12.2% on a like-for-like basis, up from 11.1% growth in the first quarter.
The company attributed the higher cognac sales to "continuing excellent trends in Greater China, as well as in other key markets of the Asia-Pacific region."
Remy's figures echoed those published earlier this week by rival Pernod Ricard, which also reported strong quarterly sales thanks to strong demand in China and India.
Last month, British rival Diageo said it expected organic net sales growth in 2019 to be "broadly" in line with the last fiscal year when it grew by 5%, although Diageo also warned of foreign exchange hits.
Remy Cointreau kept its forecast for growth in full year current operating profit at constant exchange rates and consolidation scope.
In July, finance chief Luca Marotta had said he was "fine" with analysts estimates for a 13% rise in current operating profit for the financial year.
News by Reuters, edited by Maria Cabecos, Checkout. Click subscribe to sign up for the Checkout print edition.
