Pernod Ricard profit falls as coronavirus hits sales

French spirits maker Pernod Ricard took a writedown of 1 billion euros ($1.19 billion) in full financial year 2019/20, as the coronavirus-led shutdown of bars and restaurants in most of its markets hit the company’s sales and profits.

For the year ahead, the owner of Mumm champagne, Absolut vodka and Martell cognac, predicted a prolonged downturn in travel retail but sees resilience in sales to supermarkets in the United States and Europe and a sequential improvement in China and India.

Pernod Ricard, the world’s largest spirits maker after Diageo, said profit from recurring operations fell 13.7% on an organic basis to 2.260 billion euros ($2.69 billion) in the year ended June 30.

This compared with the company’s July revised guidance for a 15% decline.

The stronger performance reflected tight cost control and better-than-expected spirits sales to supermarkets in the United States and Europe during the fourth quarter.

Pernod Ricard’s impairment charge follows those of other alcoholic beverage makers, Diageo, AB InBev and Heineken.