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Rémy Cointreau Q1 sales suffer an expected slide

Published:  20 July, 2016

Famed cognac conglomerate Rémy Cointreau's first quarter reported sales slid -2.1% to €218.6 million for the three months ending on 30 June 2016.

While the news missed analysts expectations of 1.5% growth, the company had anticipated a dip in the first quarter.

"The sales trend in this early part of the year was in line with our expectations and represents a good performance following growth of 10% in the fourth quarter of the 2015/16 fiscal year. Quarterly volatility in sales has masked a further uplift in end demand for our products in both volume and value terms over the past few months," according to a statement released by the company.

The Asia Pacific market continued to improve with depletions accelerating, although "revenues dipped as expected in the first quarter." Europe, Middle East and Africa's regional growth was driven by emerging regions expansion. The Americas were by far the strongest performing regions with cognac driving the growth.  

Rémy Martin had "almost stable cognac sales in the first quarter" which was a reflection of  "excellent performance in the Americas region and a one-off decline in the EMEA and Asia Pacific regions."

A trend towards better quality, high-end cognacs in particular, following marketing and communication investments, seems to be emerging for the brand and is helping to keep demand up.

While the first quarter's performance was in line with group's forecasts, the overall fiscal year's profits are based on an assumption of "constant exchange rates". This could prove to be challenging over the next three quarters with the uncertainty following the Brexit vote and what may happen within the European Union.