Current Operating Profit: €319.3 million,
+27.2% organic growth Current operating margin: +36.8% as reported,
+1.7 pts organic growth EPS: €4.40, +64.7% as reported Full-year
guidance confirmed
Regulatory News:
Rémy Cointreau (Paris:RCO) generated consolidated sales
of €867.1 million in the first half of 2022-2023, up 21.1% on an
organic basis1 (+54.6% compared to 2019-2020). This performance
reflects a steep 11.4% rise due to price mix, in line with the
Group’s strategic focus on value, and 9.7% growth in volume.
Current Operating Profit came in at €319.3 million,
representing a 27.2% organic rise and 50.0% growth on a reported
basis. This was more than double the 2019-20 figure. Current
operating margin showed a 1.7-point organic rise to 36.8% (up
3.8 points as reported).
Eric Vallat, Rémy Cointreau’s CEO, stated: “Rémy
Cointreau reported excellent results and made solid progress toward
achieving our strategic priorities. In a persistently tough and
demanding environment, we are fortunate to be ahead of schedule
with our strategic plan, which allows us to stay on course and
continue investing in our brands to enhance their appeal and
awareness as we prepare for future growth. Building on these
results, we are confirming our full-year guidance, with the second
half set to reflect a return to normal consumption in the
post-covid era and some base of comparison effects after two years
of truly exceptional growth. In a half year that has seen a host of
innovation and commercial initiatives, our people have shown
impressive agility, creativity and engagement in carrying out our
strategy, and I would like to take this opportunity to express my
warmest thanks to them.”
Key figures – in €m (unless
otherwise stated)
H1 2022-23
H1 2021-22
Reported change
Organic change
vs. H1 2021-22
vs. H1 2019-20
Sales
867.1
645.3
+34.4%
+21.1%
+54.6%
Gross margin (%)
71.9%
69.1%
+2.8 pts
+1.8 pts
+3.3 pts
Current Operating Profit
319.3
212.9
+50.0%
+27.2%
+98.7%
Current operating margin (%)
36.8%
33.0%
+3.8 pts
+1.7 pts
+7.7 pts
Net profit - Group share
223.8
134.0
+67.0%
+39.9%
+107.2%
Net margin (%)
25.8%
20.8%
+5.0 pts
+3.2 pts
+6.1 pts
Net profit – Group share excl.
non-recurring items
226.8
148.2
+53.0%
+28.5%
+125.2%
Net margin excl. non-recurring items
(%)
26.2%
23.0%
+3.2 pts
+1.4 pts
+7.6 pts
EPS Group share (€)
4.40
2.67
+64.7%
+38.0%
+102.8%
EPS Group share excl. non-recurring items
(€)
4.46
2.95
+50.9%
+26.8%
+120.3%
Net debt /EBITDA ratio
0.65x
0.77x
-0.12x
-0.12x
-0.74x
Current Operating Profit by division
In €m (unless otherwise stated)
H1 2022-23
H1 2021-22
Reported change
Organic change
vs. H1 2021-22
vs. H1 2019-20
Cognac
299.7
188.1
+59.3%
+35.7%
+103.8%
As % of sales
47.0%
40.5%
+6.5 pts
+4.4 pts
+10.6 pts
Liqueurs & Spirits
31.9
37.8
-15.8%
-27.5%
+33.6%
As % of sales
14.9%
23.1%
-8.2 pts
-9.2 pts
-2.3 pts
Subtotal: Group brands
331.5
225.9
+46.7%
+25.1%
+93.9%
As % of sales
38.9%
35.9%
+3.0 pts
+0.9 pts
+7.3 pts
Partner brands
0.1
0.3
-72.0%
-24.8%
-147.8%
Holding company costs
(12.3)
(13.4)
-8.1%
-8.6%
+36.1%
Total
319.3
212.9
+50.0%
+27.2%
+98.7%
As % of sales
36.8%
33.0%
+3.8 pts
+1.7 pts
+7.7 pts
Cognac
First-half sales at the Cognac division were up a
strong 22.4% on an organic basis (up 55.8% compared to 2019-2020),
including volume growth of 6.4% and a 16.0% rise from price/mix
effects. All regions contributed to this excellent showing.
Current Operating Profit rose 35.7% on an organic basis
to total €299.7 million, for a 4.4-point organic rise in margin to
47.0%. This outstanding performance reflects very strong growth in
gross margin and firm control of overheads. At the same time, the
Group decided to postpone various marketing outlays in China until
the second half of the year due to the ongoing pandemic. As a
result, the ratio of “Marketing and communications spend / sales”
shows a temporary decline.
Liqueurs & Spirits
First-half sales at the Liqueurs & Spirits
division were up 20.7% on an organic basis (up 55.5% compared to
2019-20), including volume growth of 16.8% and an increase of 3.9%
from the price/mix effect. The division also reported a very good
summer season. All brands contributed to this very good
performance.
Current Operating Profit stood at €31.9 million, down
27.5% on an organic basis. This set current operating margin at
14.9%, or 9.2 points lower on an organic basis. This decline in
margin reflected, as expected, a steep rise in marketing and
communication spend aimed at preparing for future growth, along
with a decrease in gross margin linked to rising production costs
that was partially offset by higher sales prices and a reduction in
overheads.
Partner Brands
First-half sales of Partner Brands were down 13.0% on an
organic basis, reflecting unfavourable base effects in Europe,
particularly in the Benelux countries.
Current Operating Profit came in at €0.1 million,
compared with €0.3 million in the first half of financial year
2021-22.
Consolidated results
Consolidated Operating Profit (COP) stood at €319.3
million, up 50.0% as reported and a rise of 27.2% on an organic
basis. This means the Group recorded the equivalent of 12 months of
COP in just six months, which would make this its “second best
year” ever.
This performance includes some very positive currency
effects (+€48.6 million), due primarily to trends in the US
dollar and renminbi. The average EUR/USD conversion rate improved
from 1.19 in H1 2021-2022 to 1.04 in H1 2022-2023, while the
average collection rate (linked to the Group’s hedging policy) came
in at 1.08 in H1 2022-2023 compared with 1.18 in H1 2021-2022.
Current operating margin stood at 36.8%, up 1.7 points on an
organic basis and up 3.8 points as reported. This rise reflects the
following:
- organic growth of 1.8 points in the gross margin to 71.9% (+3.3
points compared to 2019-20), driven largely by very favourable
price/mix effects
- very good absorption of overheads (ratio down 0.7 pts on
an organic basis)
- increased marketing and communication spend (ratio up
0.8 pts on an organic basis)
- very favourable currency effects (+2.2 pts).
Operating profit came in at €315.3 million, up 58.3% as
reported, after taking into account a net charge of €4.0 million in
non-recurring items. This was mainly due to early unwinding of
rouble hedges linked to the current geopolitical situation.
Net financial expense improved from -€7.4 million in H1
2021-2022 to -€5.1 million in H1 2022-2023 thanks to the early
conversion of OCEANE bonds and currency gains on hedging of debts
denominated in foreign currency.
Tax expense totalled €86.9 million, for an effective tax
rate of 28.0% as reported (and excluding non-recurring items)
compared with 30.3% as reported in H1 2021-2022 (28.0% excluding
non-recurring items). This includes the reduction in the tax rate
in France.
Net profit - Group share came in at €223.8
million, up 67.0% as reported, which sets net margin at 25.8%, up
5.0 pts as reported.
Excluding non-recurring items, net profit – Group share
stood at €226.8 million, up 53.0% as reported, setting net margin
at 26.2%, up 3.2 pts as reported.
EPS Group - share came to €4.40, up 64.7% as reported
from 2021-2022 and more than double the 2019-2020 figure. Excluding
non-recurring items, EPS was €4.46.
Net debt was €348.3 million, down €5.0 million from the
position at 31 March 2022. In addition to free cash flow, this
improvement reflects the non-cash impact of early conversion of
part of the Group’s OCEANE debt for €42.3 million, offset by
rollout of a €61.7 million share buyback programme. A total of
393,667 OCEANE bonds were thus converted to Rémy Cointreau shares
over the period, raising the total share of OCEANE bonds converted
to 73.7%. Given the conversion ratio, 397,993 shares were created
in this way.
The net debt/EBITDA ratio came out at 0.65 at 30
September 2022, compared with 0.79 at 31 March 2022 and 0.77 at 30
September 2021.
Full-year guidance confirmed
Ideally positioned to take advantage of new consumption trends
and buoyed by its advance on roll-out of its strategic plan, Rémy
Cointreau is looking to 2022-2023 with confidence.
The Group intends to continue to gain market share value in the
exceptional spirits sector. It expects another year of strong
organic growth, including normalization of consumption trends
in the second half on the heels of two outstanding years.
More specifically, as life “returns to normal” in most regions,
overall consumption from H2 on is likely to settle in at “new
normal” levels that are well above those observed in 2019/20. At
the same time, growth should be tempered by high bases of
comparison.
The Group intends to continue implementing its strategy focused
on medium-term brand development and underpinned by a policy of
sustained investment in marketing and communications, particularly
in the second half of the year.
As a result, organic COP margin improvement will
be driven by gross margin resilience despite the inflationary
environment and by tight control of overhead costs.
Taking into account the impact of phasing effects on sales
trends and marketing/communication spends, organic COP margin
improvement will be primarily driven by H1.
The full-year impact of currency should be positive
for:
- sales: +€ 110/120m
- COP: +€55/60m
Subsequent events
On 20 October 2022, Rémy Cointreau announced the creation
of Maison Psyché, a luxury perfume house that will harness blending
and ageing expertise specific to the world of spirits to transform
the finest raw materials used in perfumes and create innovative
fragrances.
On 27 October 2022, Rémy Cointreau announced the
successful launch of My Rémy Cointreau, its first international
employee share ownership plan. Half of all eligible employees
subscribed, and at the end of the operation, total employees held
0.07% of the company’s share capital through the My Rémy Cointreau
FCPE fund.
Appendices
Sales and Current Operating Profit by division
€m (unless otherwise stated)
H1 2022-23
H1 2021-22
Change
Reported
Organic
Reported
Reported
Organic
A
B
C
A/C-1
B/C-1
Sales
Cognac
638.1
568.7
464.6
+37.3%
+22.4%
Liqueurs & Spirits
214.5
198.1
164.1
+30.7%
+20.7%
Subtotal: Group Brands
852.6
766.8
628.7
+35.6%
+22.0%
Partner Brands
14.5
14.5
16.6
-12.5%
-13.0%
Total
867.1
781.3
645.3
+34.4%
+21.1%
Current Operating Profit
Cognac
299.7
255.3
188.1
+59.3%
+35.7%
As % of total sales
47.0%
44.9%
40.5%
+6.5 pts
+4.4 pts
Liqueurs & Spirits
31.9
27.4
37.8
-15.8%
-27.5%
As % of total sales
14.9%
13.8%
23.1%
-8.2 pts
-9.2 pts
Subtotal: Group Brands
331.5
282.7
225.9
+46.7%
+25.1%
As % of total sales
38.9%
36.9%
35.9%
+3.0 pts
+0.9 pts
Partner Brands
0.1
0.3
0.3
-72.0%
-24.8%
Holding company costs
(12.3)
(12.2)
(13.4)
-8.1%
-8.6%
Total
319.3
270.7
212.9
+50.0%
+27.2%
As % of total sales
36.8%
34.6%
33.0%
+3.8 pts
+1.7 pts
Summary income statement
€m (unless otherwise stated)
H1 2022-23
H1 2021-22
Change
Reported
Organic
Reported
Reported
Organic
A
B
C
A/C-1
B/C-1
Sales
867.1
781.3
645.3
+34.4%
+21.1%
Gross margin
623.7
553.8
445.9
+39.9%
+24.2%
Gross margin (%)
71.9%
70.9%
69.1%
+2.8 pts
+1.8 pts
Current Operating Profit
319.3
270.7
212.9
+50.0%
+27.2%
Current operating margin (%)
36.8%
34.6%
33.0%
+3.8 pts
+1.7 pts
Other operating income and expenses
(4.0)
(4.0)
(13.6)
-
-
Operating profit
315.3
266.7
199.3
+58.3%
+33.9%
Net financial income (expense)
(5.1)
(6.9)
(7.4)
-30.3%
-6.8%
Corporate income tax
(86.9)
(72.8)
(58.1)
+49.6%
+25.3%
Tax rate (%)
(28.0%)
(28.0%)
(30.3%)
+2.3 pts
+2.3 pts
Share in profit (loss) of
associates/minority interests
0.4
0.4
0.2
-
-
Net profit – Group share
223.8
187.5
134.0
+67.0%
+39.9%
Net margin
25.8%
24.0%
20.8%
+5.0 pts
+3.2%
Net profit – Group share excl.
non-recurring items
226.8
190.5
148.2
+53.0%
+28.5%
Net margin excl. non-recurring items
26.2%
24.4%
23.0%
+3.2 pts
+1.4 pts
EPS Group - share (€)
4.40
3.68
2.67
+64.7%
+38.0%
EPS Groupe – share excluding non-recurring
items (€)
4.46
3.74
2.95
+50.9%
+26.8%
Reconciliation of net profit and net profit excluding
non-recurring items
€m
H1 2022-23
H1 2021-22
Net profit – Group share
223.8
134.0
Other operating income and expenses
4.0
13.6
Tax on “other operating income and
expenses”
(1.0)
(3.4)
Effect of changes in the tax rate on
deferred taxes in France, the United Kingdom and Greece
-
4.0
Net profit - Groupe share excluding
non-recurring items
226.8
148.2
Definitions of alternative performance
indicators
Due to rounding, the sum of values presented in this document
may differ from totals as reported. Such differences are not
material.
Rémy Cointreau’s management process is based on the following
alternative performance indicators, selected for planning and
reporting purposes. The Group’s management considers that these
indicators provide users of the financial statements with useful
additional information to help them understand the Group’s
performance. These alternative performance indicators should be
considered as supplementing those included in the consolidated
financial statements and the resulting movements.
Organic growth in sales and Current Operating Profit
Organic growth is calculated excluding the impact of exchange
rate fluctuations, acquisitions and disposals. This indicator
serves to focus on Group performance common to both financial
years, which local management is more directly capable of
measuring.
The impact of exchange rates is calculated by converting sales
and Current Operating Profit for the current financial year using
average exchange rates (or, for Current Operating Profit, the
hedged exchange rate) from the previous financial year.
For acquisitions in the current financial year, sales and
Current Operating Profit of acquired entities are not included in
organic growth calculations. For acquisitions in the previous
financial year, sales and Current Operating Profit of acquired
entities are included in the previous financial year; however, they
are only included in current year organic growth calculations with
effect from the anniversary date of the acquisition.
For significant disposals, data is post-application of IFRS 5,
under which results of entities disposed of are systematically
reclassified under “Net earnings from discontinued operations”.
Indicators “excluding non-recurring items”
The two items set out below constitute key indicators for
measuring recurring business performance, since they exclude
significant items which, by virtue of their unusual nature, cannot
be considered inherent to the Group’s ongoing performance:
- Current Operating Profit consists of operating profit
before other non-recurring operating income and expenses.
- Net profit attributable to the Group excluding non-recurring
items consists of net profit attributable to the Group adjusted
to exclude other non-recurring operating income and expenses,
associated tax effects, profit from deconsolidated, divested and
discontinued operations and the contribution from dividends paid in
cash.
Gross operating profit (EBITDA)
This measure, which is used in particular to calculate certain
ratios, equates to Current Operating Profit less amortisation and
depreciation expenses on intangible assets and property, plant and
equipment for the period, expenses arising from stock option plans,
and dividends received from associates during the period.
Net debt
Net financial debt as defined and used by the Group is equal to
the sum of long- and short-term financial debt and accrued
interest, less cash and cash equivalents.
About Rémy Cointreau
All around the world, there are clients seeking exceptional
experiences; clients for whom a wide range of terroirs means a
variety of flavors. Their exacting standards are proportional to
our expertise – the finely-honed skills that we pass down from
generation to generation. The time these clients devote to drinking
our products is a tribute to all those who have worked to develop
them. It is for these men and women that Rémy Cointreau, a
family-owned French Group, protects its terroirs, cultivates
exceptional multi-centenary spirits and undertakes to preserve
their eternal modernity. The Group’s portfolio includes 14 singular
brands, such as the Rémy Martin and Louis XIII cognacs, and
Cointreau liqueur. Rémy Cointreau has a single ambition: becoming
the world leader in exceptional spirits. To this end, it relies on
the commitment and creativity of its 1,924 employees and on its
distribution subsidiaries established in the Group’s strategic
markets. Rémy Cointreau is listed on Euronext Paris.
Regulated information in connection with this
press release can be found at www.remy-cointreau.com
_______________________
1 All references to “organic growth” in this press release refer
to growth at constant currency and consolidation scope
View source
version on businesswire.com: https://www.businesswire.com/news/home/20221123005451/en/
Investor relations: Célia d’Everlange /
investor-relations@remy-cointreau.com Media relations:
Carina Alfonso Martin / press@remy-cointreau.com
Remy Cointreau (EU:RCO)
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