Rémy Cointreau has reported a major increase in first-half net profits driven by Cognac sales in the US and China.
Net profits in the six months to the end of September jumped by 83% to EUR86.6m (US$108.3m), the Paris-based company said today. As announced last month, net sales increased on an organic basis by 13.3% to EUR595.8m over the same period, while operating profits rose - again on an organic basis - by 18% to EUR141.5m, the company said.
Remy, which recently bought Islay Scotch maker Bruichladdich, said it had enjoyed “an excellent first half-year” during which operating margins increased from 22.4% last year to 23.7%. “This six months performance was due to strong business momentum in all regions of the world,” it said. “The group once again achieved remarkable growth in Asia and the US and, to a lesser extent, in Europe.”
The results mirrored Remy's strong Q1 results, when sales in the three months to the end of June leapt by 24.4% year-on-year in organic terms and Rémy Martin Cognac sales climbed by 37.8%.
In today's numbers, Remy's Cognac division - which now accounts for 63% of annual sales - reported a 44.1% increase in operating profits and a two percentage point rise in operating margins as demand in China continued to surge. US demand was also strong, helping Remy Martin to its third year in a row of H1 double-digit growth.
Liqueurs and spirits saw organic sales increase by 3.5%, with Cointreau showing growth in the US and Europe. Remy's partner brands, which account for 18% of sales, posted a 4.1% sales increase primarily due to the strong performance of Scotch in the US. Champagne sales remained “challenging”, particularly in Europe, Remy said.
Europe was Remy's weakest regions, with slower growth hampering the company's full-year outlook.
“In an uncertain economic environment, particularly in Europe, Rémy Cointreau confirms the effectiveness of its value and long-term strategy,” Remy said. “Management will continue to implement strict cost control in the second half of the year, whilst closely monitoring market developments.”
Second-quarter figures were not released in Remy's preliminary results.
In early trading today, Remy's shares increased by about 6%.
