Remy breaks years of sales declines and still disappoints

By Emma Rumney

LONDON, April 30 (Reuters) - ‌Remy Cointreau reported ​positive ​annual sales on Thursday for the first time since 2023 but still fell short of forecasts, undermining CEO Franck Marilly's promise to start ‌a "new era" for the French spirits maker this year.

The maker of ⁠Remy Martin cognac and Cointreau liqueur reported 0.2% organic growth in annual sales, narrowly avoiding a ‌third consecutive annual decline but slightly ‌short of analyst expectations.

Remy shares were down 2.5% by 0744 GMT, compared to fall of around 1% across French stocks.

Sales of cognac, Remy's core product for ​which demand has fallen sharply in recent years, were also below analyst forecasts.

Marilly took over as CEO in June, promising to revive performance and make ⁠the company less vulnerable to economic cycles, even if that meant cutting cognac prices to grow volumes.

He is ​set to lay out his strategy in detail in June. He promised 2026 would mark a new era for Remy when presenting ​its first-half in November.

Soaring living costs and tariffs ‌in Remy Cointreau's main markets of the U.S. and China have hit the company hard.

More recently, the Iran war has disrupted ⁠sales of luxury drinks in airports and threatens to further dent demand, as well as raise producers' costs for bottles, grain and other raw materials.

RESULTS HAVE NOT CHANGED THE NARRATIVE, ⁠ANALYST SAYS

Cognac sales rose 15.5% in the fourth quarter, supported by strong performance in China, where ​Remy benefited from a "very favourable" comparison base a year earlier, the company said.

In the Americas, Remy said it recorded a "slight decline" though efforts to revive U.S. sales of the cheaper version ‌of its Remy Martin cognac helped an improvement versus the third quarter.

Laurence Whyatt, analyst at Barclays, said Remy's fourth quarter showed ‌an acceleration, but this was largely driven by timing effects.

"Overall, this was a weaker print ⁠than expected," he said. "The results ‌do little to change the ​broader narrative of timing-driven volatility and still-challenging underlying demand conditions."

(Reporting by Emma Rumney; Editing by Sherry Jacob-Phillips, Thomas Derpinghaus, Louise Heavens and ‌Barbara Lewis)

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