Pernod Ricard

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URL : https://www.gbl.be/en/portfolio/pernod-ricard

Pernod Ricard

Pernod Ricard, the world´s number two player in Wines & Spirits holds a leading position globally

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  • 7.49%
    Share capital 30/09/2018
  • 2,811 EUR M
    Value of the stake 30/09/2018
  • 11.82%
    Voting rights 30/09/2018
  • 2
    Number of representatives in statutory bodies 30/09/2018
Investment Year 2006 Investment history

Since its inception in 1975, Pernod Ricard has built up the most premium portfolio in the industry and has become the world’s number two player in the Wine & Spirits market through organic growth and acquisitions, including Seagram in 2001, Allied Domecq in 2005 and Vin&Spirit in 2008. This portfolio includes notably 13 strategic international brands, 15 strategic local brands and 4 premium wine brands, produced and distributed by the group through its own worldwide distribution network.

 

Performance in 2017

In 2016/17, Pernod Ricard delivered a strong year with business accelerating, and is on track to deliver mid-term roadmap. The organic top line growth has reached 3.6%, getting closer to the mid-term objective of + 4% to + 5%. The profit from recurring operations (PRO) recorded a solid organic growth: + 3.3%, at the higher end of the annual guidance bracket of + 2% to + 4%, despite unexpected regulatory changes in India. The operating margin was up by 35bps thanks to foreign exchange impacts. The group’s share of net profit was up 13%, whilst cash flow generation and deleveraging improved significantly. Free cash flow increased by 22%, and 61% in two years, to historic high, supported by operational efficiency initiatives.

Deleveraging was significant with net debt/EBITDA ratio at 3.0x down 0.4x vs. FY16, and net debt down by EUR 0.9 billion to EUR 7.9 billion.

Furthermore, in 2016/17, there was:

  • an increase in profit from recurring operations of 8% in the Americas, 1% in Asia/Rest of World and 1% in Europe;
  • an improvement of the gross margin (+ 4%): the mix turned positive (mainly due to Jameson and Martell), pricing was still muted and costs of goods sold were tightly managed thanks to operational efficiency initiatives;
  • a dividend per share of EUR 2.02, a 7% increase compared with the previous year. This represents a pay-out ratio of 36%, in line with the customary policy of cash distribution of approximately one-third of the group’s net profit from recurring operations.

Investment case

The spirits market is supported by favourable long term trends, in particular:

  • Expanding urban population
  • Growing market share compared to beer and wine
  • Upmarket move by consumers

Pernod Ricard has a smooth growth and profitability profile:

  • Number two player worldwide with one of the industry’s most complete brand portfolios
  • Systematic upmarket move thanks to its superior-quality and innovative products
  • Numerous high potential brands
  • Leading positions in categories such as whisky, rum and cognac

Governance

Strategic Committee (1/6*) Board of Directors (2/14*) Audit Committee (1/3*) Compensation Committee (1/4*)
Ian Gallienne
Ian Gallienne
Click to see the detailed CV

Ian Gallienne

Co-CEO, Member of the Standing Committee

Born on 23 January 1971, in Boulogne-Billancourt, France, French nationality.
Ian Gallienne holds an MBA from INSEAD in Fontainebleau.
He began his career in Spain, in 1992, as co-founder of a commercial company. From 1995 to 1997 he was Manager of a consulting firm specialised in turning around struggling businesses in France. From 1998 to 2005 he was Manager at the private equity funds Rhone Capital LLC in New York and London. In 2005 he created the private equity fund Ergon Capital in Brussels and was its Managing Director until 2012.
In 2012 he became Co-CEO of Groupe Bruxelles Lambert, which he had been a Director of since 2009.

Member Member Member
Gilles Samyn
Gilles Samyn
Click to see the detailed CV

Gilles Samyn

Director, Member of the Standing Committee, of the Audit Committee and of the Nomination and Remuneration Committee

Born on 2 January 1950, in Cannes, France, Belgian and French nationality.
Gilles Samyn holds a Commercial Engineering degree from the Solvay Business School (ULB), where he has held research and teaching positions since 1969. He began his career at Mouvement Coopératif Belge in 1972, then moved to Groupe Bruxelles Lambert at the end of 1974. After spending a year in self-employment he started working for the Frère-Bourgeois group in 1983 and is now a Managing Director, as well as Chairman of the Board of Directors of CNP-NPM.
He has been a Director of Groupe Bruxelles Lambert since 1987.

 		Member Member
* Number of GBL's representatives in statutory bodies in relation to the total number of members. Governance information is dated 31/12/2017, except where superseded by more recent public disclosures.