Remy Cointreau cuts FY sales guidance, shares tumble

Remy Cointreau tumbled on Friday after the spirits maker downgraded its full-year sales guidance as it posted a drop in first-half revenue, highlighting a slower-than-expected recovery in the US.

Revenue declined by 22% on an organic basis to €636.7m, missing analyst expectations of €640.2m.

The company pointed to continued destocking in the US in a "worsening market". In particular, it noted a "fiercely promotional" environment and a rise in interest rates that has cut the financing capacity of distributors. As a result, the rebound in sales that was previously seen occurring in the third quarter is now expected to take place in fiscal 2024-25.

Remy Cointreau hailed solid growth in sales in China despite a slower-than-expected post-Covid recovery.

It also highlighted "robust" trends in the rest of the world, namely in other Asian countries, as travel retail continues to bounce back.

Pointing in part to the US slowdown, the company said it now expects full-year sales to fall by between 15% and 20%, versus previous guidance for them to be stable.

At 0930 BST, the shares were down 10% at €105.85.