Remy Cointreau shares are trading in the red Friday, following the release of the alcohol-maker’s nine-month earnings. While the French spirits group's overall earnings growth was ahead of forecast, investors were spooked by a currency warning.
By 1220 BST, Remy Cointreau shares were trading 1.36% lower at €109.10. The Remy Cointreau stock price had pared back steeper gains earlier in the European trading session.
Strong sales figures
Remy Cointreau’s nine-month results showed total group sales in the nine months to December grew 3% to €862.1 million. Organic sales growth was 5.5%, over the same period. In the three months ending December 2017, the French beverage maker recorded organic sales growth of 3.2%.
“Performance in the first nine months was driven by the Group Brand, in particular by the House of Rémy Martin, while Liqueurs & Spirits and Partner Brands were negatively impacted by the deconsolidation of Passoã and the end of the distribution agreement for the champagne brands, respectively,” the Remy Cointreau earnings press release read.
Partner Brand sales fell 8.5% during the nine months to the end of 2017.
Geographically, sales across Asia Pacific were the main driver of growth. Sales in the US, meanwhile, were “solid” in the second and third quarters. And, strong sales momentum was seen in Russia, Central Europe, Africa and the UK.
Strong euro to weigh on profits
While sales beats forecasts, a warning from Remy Cointreau’s chief finance officer that the strong euro would have a bigger detrimental impact on earnings than previously estimated, didn’t go down well.
Remy Cointreau’s finance chief Luca Marotta, told reporters the strong euro against the dollar would likely knock 17-to-18 million euros off the French spirit maker’s full-year operating profit. That’s a bigger affect than the previous forecast of €10-11 million previously forecast.
Despite that news, Remy Cointreau confirmed it still anticipates full-year earnings to be in line with it’s current guidance.