Cognac sales headache for Remy Cointreau

NIGEL COPE

Remy Cointreau, the French drinks group, reported a fall in operating profits yesterday as a result of lower sales of its Remy Martin brand of cognac and the effects of currency fluctuations. The company also announced plans to reduce its Fr8.8bn (pounds 1.15bn) debt mountain to Fr6bn by converting debt into equity stakes.

Reporting figures for the nine months between April and December, the company said sales of cognac were 10 per cent down on the same period last year after the company introduced a price rise in July. The company lost market share to other cognac producers which cut prices or kept them constant.

However, Remy said rival producers were increasing prices and Remy Martin was beginning to claw back the lost ground. Sales had fallen sharply in China, though sales of champagnes such as Krug and Pieper Heidsieck had increased. Remy Cointreau's joint managing director, Marc Heriar Dubreuil, said: "You can tell the mood of a country by how much cognac it drinks."

Countries such as Vietnam, Korea and Russia were in a good mood, he said, while spirits (and sales) were deflated in France and Germany. The UK was performing steadily.

The company also said that the French government's controversial nuclear tests in the Pacific Rim last year had led to local boycotts that dented sales of its champagnes and wines. Local action was particularly strong in Scandinavia and Germany, as well as in Japan. However, sales in Britain had not been affected. Sales had also been disrupted by the recent strikes in Paris though this had not been serious.

While sales of cognac fell, champagne sales were up by 30 per cent in the period. Liqueur, wine and spirit sales were almost 10 per cent up. However, group profits were lower as the margins on champagnes and wines are slimmer. Currency fluctuations had also moved against the company.

Sales of Passoa, a passion fruit liqueur launched seven years ago, were growing strongly with sales up 30 per cent on last year.

In the six months to June, group operating profits fell from Fr394m to Fr216m. However, pre-tax profit increased from Fr135m to Fr217m due to Fr256m of exceptional items relating to the transfer of the Picon brand trading rights to Grand Metropolitan's IDV subsidiary last June.

As part of the group's policy to reduce debts its main shareholder, Orpar, has exercised its convertible bond for Fr836m creating 6 million new shares. Orpar is 70 per cent-owned by the Dubreil family which controls the group with the remaining 30 per cent held by Highland Distilleries.

PROMOTED VIDEO
Arts and Entertainment
Stik on the crane as he completed the mural
art
News
Happy in his hat: Pharrell Williams
people
News
i100(More than you think)
News
Phyllis Dorothy James on stage during a reading of her book 'Death Comes to Pemberley' last year
peopleJohn Walsh pays tribute to PD James, who died today
News
peopleExclusive: Maryum and Hana Ali share their stories of the family man behind the boxing gloves
Arts and Entertainment
John Hurt will voice Prince Bolkonsky in Radio 4's War and Peace
radioRadio 4 to broadcast 10-hour adaptation of War and Peace on first day of 2015
News
ebooksNow available in paperback
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Argyll Scott International: Service Desk Analyst

£20000 - £22000 per annum: Argyll Scott International: Service Desk Analyst Re...

Argyll Scott International: 2x Service Desk Analyst

£20000 - £22000 per annum: Argyll Scott International: Service Desk Analyst Re...

Recruitment Genius: Senior Execution Trader

£30000 - £250000 per annum: Recruitment Genius: A global Rolling Spot FX, Comm...

Citifocus Ltd: ACA - Financial Reporting

£Attractive Package: Citifocus Ltd: Chartered accountant (ACA or CPA), must be...

Day In a Page

Cameron, Miliband and Clegg join forces for Homeless Veterans campaign

Cameron, Miliband and Clegg join forces for Homeless Veterans campaign

It's in all our interests to look after servicemen and women who fall on hard times, say party leaders
Millionaire Sol Campbell wades into wealthy backlash against Labour's mansion tax

Sol Campbell cries foul at Labour's mansion tax

The former England defender joins Myleene Klass, Griff Rhys Jones and Melvyn Bragg in criticising proposals
Nicolas Sarkozy returns: The ex-President is preparing to fight for the leadership of France's main opposition party – but will he win big enough?

Sarkozy returns

The ex-President is preparing to fight for the leadership of France's main opposition party – but will he win big enough?
Is the criticism of Ed Miliband a coded form of anti-Semitism?

Is the criticism of Miliband anti-Semitic?

Attacks on the Labour leader have coalesced around a sense that he is different, weird, a man apart. But is the criticism more sinister?
Ouija boards are the must-have gift this Christmas, fuelled by a schlock horror film

Ouija boards are the must-have festive gift

Simon Usborne explores the appeal - and mysteries - of a century-old parlour game
There's a Good Girl exhibition: How female creatives are changing the way women are portrayed in advertising

In pictures: There's a Good Girl exhibition

The new exhibition reveals how female creatives are changing the way women are portrayed in advertising
UK firm Biscuiteers is giving cookies a makeover - from advent calendars to doll's houses

UK firm Biscuiteers is giving cookies a makeover

It worked with cupcakes, doughnuts and macarons so no wonder someone decided to revamp the humble biscuit
Can SkySaga capture the Minecraft magic?

Can SkySaga capture the Minecraft magic?

It's no surprise that the building game born in Sweden in 2009 and now played by millions, has imitators keen to construct their own mega money-spinner
The King's School is way ahead of the pack when it comes to using the latest classroom technology

Staying connected: The King's School

The school in Cambridgeshire is ahead of the pack when it comes to using the latest classroom technology. Richard Garner discovers how teachers and pupils stay connected
Christmas 2014: 23 best women's perfumes

Festively fragrant: the best women's perfumes

Give a loved one a luxe fragrance this year or treat yourself to a sensual pick-me-up
Arsenal vs Borussia Dortmund: Alex Oxlade-Chamberlain celebrates century with trademark display of speed and intuition

Arsenal vs Borussia Dortmund

The Ox celebrates century with trademark display of speed and intuition
Billy Joe Saunders vs Chris Eubank Jnr: When two worlds collide

When two worlds collide

Traveller Billy Joe Saunders did not have a pampered public-school upbringing - unlike Saturday’s opponent Chris Eubank Jnr
Homeless Veterans Christmas Appeal: Drifting and forgotten - turning lives around for ex-soldiers

Homeless Veterans Christmas Appeal: Turning lives around for ex-soldiers

Our partner charities help veterans on the brink – and get them back on their feet
Putin’s far-right ambition: Think-tank reveals how Russian President is wooing – and funding – populist parties across Europe to gain influence in the EU

Putin’s far-right ambition

Think-tank reveals how Russian President is wooing – and funding – populist parties across Europe to gain influence in the EU
Tove Jansson's Moominland: What was the inspiration for Finland's most famous family?

Escape to Moominland

What was the inspiration for Finland's most famous family?