Pernod Ricard’s annual sales fall 1%, according to Reuters estimates

(Reuters) – France Pernod Ricard (EPA: ) reported a 1 percent decline in full-year organic sales on Thursday, broadly in line with forecasts and its own guidance, as it managed to largely offset deep problems in its key U.S. and China businesses.

The world’s No. 2 western spirits maker kept its full-year forecast in April even as sales in two of its biggest markets faltered, betting on a pick-up in demand in the fourth quarter .

Pernod’s net sales in the US fell 9% and saw an even steeper 10% decline in China. However, it said most other markets saw a recovery in volumes in the second half and it enjoyed decent growth in other key regions such as India, where sales rose 6 percent.

It said that helped it meet its goal of ending the year with net sales broadly flat and just ahead of the 1.2 percent decline expected by analysts.

The company achieved “robust results … in an environment of economic and geopolitical uncertainty,” Chairman and CEO Alexandre Ricard said in a statement.

Pernod and rivals have suffered as the post-pandemic boom in sales of expensive spirits reversed amid high interest rates, inflation and other difficult economic conditions.

Pernod, in particular, suffered as retailers and wholesalers in the United States reduced stocks of more expensive spirits to reflect lower demand. In China, meanwhile, sales were also weaker than expected as a troubled economy hurt consumer confidence.

Pernod said it expects a “soft” first quarter of 2025, with further adjustments to US inventories and a “very weak macro context in China”.

Elsewhere, however, they expect good performance and a continued recovery in volume, bringing net sales back to growth.

It will also support its organic operating margin, which expanded by 80 basis points in the 2024 financial year due to higher prices and tighter spending.

Profit from recurring operations rose well above estimates by 1.5%.

In the medium term, Pernod said it remained confident it could achieve organic net sales growth closer to 7%.

He proposed a dividend of 4.70 euros per share – fixed compared to last year.