Pernod Ricard Continues Expansion as Annual Profit Falls -- Update
29 Août 2019 - 10:06AM
Dow Jones News
By Saabira Chaudhuri
Pernod Ricard SA (RI.FR) said it has agreed to buy the maker of
Jefferson's bourbon in the U.S. and will open a whisky distillery
in China as the liquor giant, which is facing down an activist
investor, reported lower annual profits.
Pernod said it would acquire New York-based Castle Brands Inc.
for $223 million through a cash tender offer for the listed
company's shares. It separately said it will open a malt whisky
distillery in China--a promising growth market for alcohol
makers--by 2021.
The moves come as the liquor maker faces down pressure from
hedge fund Elliott Management Corp, which has amassed shares to
become one of Pernod's largest investors, to accelerate returns.
Elliott says that Pernod has lost market share in key drinks,
underperformed peers on key metrics and should raise its operating
margin.
The French company whose brands include Chivas whisky and
Absolut vodka announced a share buyback on Thursday of up to EUR1
billion and said it was raising its dividend. It has also nominated
two new external directors to its board following criticism from
Elliott. The firm, which ranks among the world's biggest hedge
funds and one of the most prominent activist investors globally,
had argued that Pernod's board was too French and insular.
Pernod Ricard reported lower annual profits on Thursday as
costs, including advertising and financial expenses, climbed. Net
profit for the year was 1.46 billion euros ($1.62 billion) down
from EUR1.58 billion the year prior. Sales climbed to EUR9.18
billion from EUR8.72 billion. For fiscal 2020, Pernod Ricard is
targeting organic growth in profit from recurring operations
between 5% and 7%, below what analysts were expecting.
Anthony Shevlin contributed to this story
Write to Saabira Chaudhuri at Saabira.Chaudhuri@wsj.com
(END) Dow Jones Newswires
August 29, 2019 03:51 ET (07:51 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
Pernod Ricard (EU:RI)
Graphique Historique de l'Action
De Fév 2024 à Mar 2024
Pernod Ricard (EU:RI)
Graphique Historique de l'Action
De Mar 2023 à Mar 2024