French spirit producer Rémy Cointreau has had a tremendous financial year, as cognac proved to be a booming business with sales going up 12 %.
Ambition: become the world leader
In its financial year 2018/19, Rémy Cointreau achieved a turnover growth of 7,9 % to 1.22 billion euros. Its organic operational profit growth was 14 % (to 263,3 million euros, better than the 259 million analysts were expecting). The operational profit margin went up 2,6 percentage points to 21.7 %.
Cognac branch ‘Maison Rémy Martin’ achieved an organic operational profit growth of 17.9 % (to 235.6 million euros) as turnover went up 11.9 %. Its flagship cognac Rémy Martin XO sold better than ever before, as did the even more exclusive Louis XIII. The spirits and liquors branch (with Cointreau en The Botanist gin) grew 4 %, but saw its operational profits drop 6 % due to an increased spending on marketing.
The record figures have persuaded the group's management to make some ambitious claims: it wants to become the world leader in the market of high-end spirits. To that end, almost two thirds of turnover should come from up-market drinks, meaning they cost more than 50 dollars (45 euros).