Scotland’s second-largest whiskey producer toasts US tariff progress

Chivas Regal owner Pernod Ricard will benefit from the suspension of US tariffs on imports of Scotch whiskey.

The French group, also owner of The Glenlivet, which is one of the biggest sellers on the American market, should be one of the main beneficiaries of the suspension of scotch whiskey prices.

Bosses have already guided investors to double-digit organic profit growth for the past full year as foreclosure measures continued to be relaxed in key markets, and a partial recovery in the hospitality sector is expected. have experienced continued strong growth in sales during the current period.

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The group achieved third quarter revenue of just over € 1.9 billion (£ 1.6 billion), up 19.1% from the previous year on an organic basis and ahead of forecasts. This marked an acceleration from the first half performance, leading to sales for the first nine months of the year of 6.9 billion euros, up 1.7% on an organic basis.

At the time, he said he expected sales to increase further in the fourth quarter thanks to the gradual reopening of hospitality sectors in key markets, although he warned that his sales based on travel would remain low due to restrictions.

Pernod Ricard, which also owns Mumm champagne, Absolut vodka and Martell cognac, was also recently spurred on by a US court ruling on a separate issue on export tax treatment that should allow it to register a sum additional amount of around 140 million euros. in profit before tax in its 2021 results. The windfall represents around 1% of organic growth.

In February, Chivas Brothers Chairman and CEO Jean-Christophe Coutures stressed the importance of the removal of tariffs on exports of Scottish single malt to the United States for the continued recovery of the market. whiskey industry. He also called on the UK government to prioritize Scotch’s interests in future free trade agreement negotiations.

Last month, Johnnie Walker and the owner of Haig Club Diageo welcomed the tariff suspension as they reported strong annual sales.

Ewan Andrew, president of the company’s global supply chain and purchasing, reported double-digit growth in scotch sales and said he was “very happy” to see the US tariff dispute evolve towards a resolution.

Group-wide net sales increased 8.3 percent for the year ended June, after taking into account the negative impact of exchange rate fluctuations.

North America was distinguished by Diageo with organic growth of 20.2%, aided by “resilient consumer demand” and the restocking of distributors and retailers.

The latest results showed that reported operating profit was up 74.6 percent. Organic growth in operating profit was 17.7 percent, following a decline in the previous year, with growth recorded in all regions except Europe and Turkey.

The company said UK spirits sales rose 16%, with buyers buying more whiskey, Baileys, vodka and gin, with increases in new product lines such as Gordon’s Sicilian Lemon. and Captain Morgan Tiki rum.

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