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UPDATE 1-Pernod says China New Year business softer
March 21, 2013 / 4:41 PM / 5 years ago

UPDATE 1-Pernod says China New Year business softer

* Looking for 9-months double-digit sales growth in Asia

* Pernod reports Q3 sales on April 25

* Pernod shares down 4 percent (Adds details, shares)

By Dominique Vidalon

PARIS, March 21 (Reuters) - French drinks maker Pernod Ricard said on Thursday that business during the Chinese New Year was “softer” this year than last year but that it expected sales in Asia to still achieve double-digit growth in the nine months to March 31.

Asia is a key engine of Pernod Ricard’s growth, accounting for 41 percent of group sales and 46 percent of operating profit in the first-half of the 2012/13 year, and its shares were down by 4 percent at 1540 GMT.

“We can still look for double-digit growth,” Asia chief Pierre Coppere said, when asked during an analysts call about the Asia sales trend for the first nine months of FY 2012/13.

Pernod Ricard Asia’s underlying sales grew 14 percent in the first half and operating profit rose 21 percent, driven by robust demand for cognac in China and whisky in India.

The world’s second-largest spirits group after British rival Diageo will unveil its third-quarter sales on April 25.

In China, Pernod’s largest market after the United States, the trend was for double-digit sales growth for the nine-months, following an 18 percent rise in the first-half, Coppere said.

Celebrations for the Chinese New Year, which started on Feb. 10, are usually a big driver of sales for spirits companies like Pernod, whose Martell cognac is a hit with Chinese consumers.

With a 37 percent market share, Pernod Ricard is the leader in super-premium spirits in Asia. It is number one in cognac in China, where it has a market share of around 40 percent.

Last month, Pernod Ricard stuck with a full-year underlying operating profit growth goal of close to 6 percent, betting that robust Asian demand and strong growth in the United States would offset a sales decline in France and Spain. (Reporting by Dominique Vidalon; Editing by Lionel Laurent and Elaine Hardcastle)

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