It seems that all we’ve been reporting for the past year is the incredible rise in cognac sales in Asia, and China in particular, on an almost daily basis. However, there are now signs that the ‘golden age of cognac’ might be taking a step down the podium to the silver position.
By the way, did you know? We have a Chinese version of the blog
Diageo, distributor of Hennessy Cognac (part of LVMH), the largest global cognac distiller (by revenue), reports a slowing of sales in Asia in September, with cognac exports slowing to 7 per cent growth. This follows the healthy 20 per cent growth seen during August and 37 per cent growth in total year to date.
But despite this, the LVMH group have reported that organic sales of both cognac and other spirits have risen by 12 per cent in the period July – September. This outperforms their champagne and wine sales which only rose by 6 per cent.
Hot on the heels of Diageo’s figures, Remy Cointreau has also said that their growth slowed dramatically in the second quarter. This was mainly because of the weak economic climate in Europe. However, with the slowdown in China seemingly gaining momentum, and the fact that their Asia-Pacific sales account for 60 per cent of the group’s cognac revenue, concern is growing over this area.
Remy Cointreau liqueur and spirit division have posted a 0.4 per cent quarterly drop in organic revenue. This meant that they failed to hit their sales estimates for this quarter. Although organic revenue climbed 13 per cent in the first six months of the year (through to September), they failed to hit the estimated 18 per cent that was predicted by nine separate analysts. So whilst they climbed 24 per cent during the first quarter, they only rose 5.3 per cent during the second. This was the largest drop in sales since March 2009 – a factor that saw Remy’s shares drop by a massive 8 per cent.
Sources: www.just-drinks.com, www.ft.com, www.reuters.com