China bounce boosts Pernod Ricard

Pernod  Ricard  's exposure to emerging markets, and particularly China, could have put the drinks giant on a shallower curve than some others in the sector in the economic downturn.

Asia, and by that we mean Martell  Cognac  sales in China, primarily led Pernod to report better-than-expected sales in its first fiscal quarter.

Asia was the only region to report organic sales growth (3%), with Americas, Europe and France down 2%, 11% and 3% respectively. China, said Pernod, drove a 13% net sales increase for Martell Cognac during the three-month period to the end of September.

As analyst group Sanford C Bernstein put it: "Premiumisation is not dead, it is alive and well, and sipping Cognac in China."

Pernod, which predicted cautious full-year operating profits growth at yesterday's annual general meeting, has spent 2009 talking up its exposure to emerging markets.

CEO Pierre Pringuet told just-drinks at a conference in Paris earlier this year that emerging markets could bring in half of the firm's recurring annual profits by 2020.

Emerging markets such as China, Russia, India and Brazil currently contribute around a third of annual profits.

From the most recent figures, it appears Pernod is already reaping some of the benefit of its push into new markets.