Woes in China and the US have quashed promising signs of recovery in Pernod Ricard’s global business, as revenues and profits fell for another year.
Pernod’s organic decline in annual sales accelerated from 3% to 3.9% in 2026, at the bottom of the range predicted in April’s downgrade to forecasts.
Net sales fell to €9.4bn (£8.1bn) in the year to end of June.
The maker of Absolut vodka and Jameson whisky’s massive difficulties in both the US and China continued, with US sales down by 14% and China’s by 19%.
The two markets make up 24% of Pernod’s net sales, and their rapid decline also helped cause a 5.2% organic fall in profit from continuing operations to €2.4bn.
But the troubles in its two key markets have masked an overall recovery, with the rest of the world in 0.5% growth overall. Bright spots such as India, which grew 7%, and Turkey, up 26%, have helped buoy the group, though sales fell 3% in Europe.
The group also managed to grow its market share in the UK, according to Pernod Ricard CEO for Northern Europe, Julia Massies.
“Jameson, Absolut and Altos performed strongly, as did the champagne brands,” she told The Grocer.
“Momentum is also building behind our ready-to-drink and ready-to-serve offerings. We remain focused on meeting evolving consumer needs, and investing behind our brands and in our customers, to deliver sustainable long-term growth.”
Pernod has also made progress on its €1bn programme of cutbacks, with around €500m achieved in FY2026, and completion expected a year early in FY2028.
Pernod has cut around 3,600 jobs since 2023.
While “certainly not disastrous”, Pernod’s results fell slightly on the wrong side of analysts’ consensus, according to RBC’s James Edwardes Jones.
Pernod’s expectations of broadly flat organic growth in FY2027 also fall behind market expectations, with investors looking for 1.8% growth in the coming year.
The company’s admission that its medium term (FY2027-2029) outlook will be at the lower end of its previously guided 3% to 6% growth “is likely to be the key focus”, said Barclays analyst Laurence Whyatt.
For Edwardes Jones, Pernod’s caution chimed with that of its rival Diageo.
“We think this [view] gives some validation for Diageo, which only expects organic sales to climb to 2.5% to 3% as its exit rate for 2029, and similarly expects flattish sales growth in 2027.”
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