Pernod Ricard has today reported a 3% decline in third-quarter sales, missing forecasts as tariff uncertainty rocks the already-struggling spirits sector.
Analysts had expected Pernod, the world’s second biggest Western spirits maker, which produces Jameson Irish whiskey and Mumm champagne, to report a 2% decline in organic net sales in the three months to end March.
Pernod said its results were affected by customs clearance procedures and a production interruption in India, the late timing of Easter, tariffs affecting cognac sales in China, and a sharp decline in its travel retail division due to the suspension of duty-free sales of cognac there.
CEO Alexandre Ricard told Reuters that had it not been for a technical interruption at a bottling plant in India and the late timing of Easter – neither of which will remain a factor in the next quarter – Pernod’s results would have been in line with expectations.
On tariffs, Pernod had observed no change in underlying demand in the US, but it was hard to predict if that would change, Ricard continued.
Pernod left its full-year guidance for a low single-digit decline in sales unchanged, but warned the environment “remains challenging and very fluid with regard to tariffs”.
It had previously cut its 2025 outlook as well as its growth forecast for 2027-2029, citing geopolitical uncertainties such as tariffs.
US efforts to rewrite the global trade relationships have plunged the entire spirits sector into uncertainty. Pernod and other cognac makers separately face tariffs in China.
It put the annual impact of tariffs at €200m in February.
Escalating trade tensions also threaten consumer sentiment at a time when the appetite for pricey liquors is already under pressure.
Spirits sales have been falling industry-wide as growth in the US in particular retreats from the post Covid-19 boom, compounded by high interest rates and inflation.
Pernod’s US sales rose 2% in the quarter, helped by increased orders ahead of expected tariffs. But that was offset by declines in Europe, China and its travel retail division, where sales tumbled 31%.
In India, another key market, its results were hurt by the implementation of new customs clearance procedures and a “temporary production interruption” in a major state that is now resolved, Pernod said.
