Rémy Cointreau's 2024-25 9M Sales: A Closer Look

In the first nine months of 2024-25, Rémy Cointreau, the renowned French spirits and liqueurs company, reported sales of €787.8 million, down -17.8% on an organic basis. This decline, while significant, is in line with the company's guidance for the full year. Let's delve into the factors contributing to this sales performance and the strategies Rémy Cointreau is implementing to mitigate the impact.

Regional Performance

1. Americas: The Americas region experienced a sharp contraction in sales in Q3 2024-25, hit by destocking and a high basis of comparison. Despite this, there was a sequential improvement in depletions in volume in the United States compared with Q2 2024-25. The region is not expected to return to growth before the fourth quarter of 2024-25 at the earliest.
2. APAC (Asia-Pacific): APAC saw a decline in sales, reflecting tougher market conditions in China in Q3 2024-25. However, the region demonstrated resilience in direct distribution channels and RM Club. South-East Asia experienced a rebound, supported by strong growth in the Liqueurs & Spirits segment. The region is expected to face sequential sales deterioration in the second half compared with the first half.
3. EMEA (Europe, Middle East, and Africa): EMEA showed a strong sequential improvement in Q3 2024-25, driven by growth in Liqueurs & Spirits. The region is expected to continue with subdued consumer trends in the second half of the year.

Strategies to Mitigate Sales Decline

Rémy Cointreau has implemented several strategies to mitigate the impact of the sales decline and protect its Current Operating Margin (COP). These include:

1. Tight cost controls: The company has maintained strict cost controls to offset the decline in sales and preserve its COP. This has been achieved by reducing costs in line with its plan, as reflected in the rise of the current operating margin by +1.0 points as reported in the first half of 2024-25.
2. New cost-cutting plan: Rémy Cointreau has rolled out a new cost-cutting plan totaling over €50 million. This plan is expected to help the company achieve its full-year 2024-25 objectives, including an organic decline in sales of between -15% and -18% and a COP margin of between 21% and 22% on an organic basis.
3. Gross margin improvement: Despite the sales decline, Rémy Cointreau has managed to improve its gross margin on an organic basis. In the first half of 2024-25, the gross margin stood at 72.5%, an increase of +3.0 points compared to 2019-20. This improvement has helped the company maintain its profitability despite the challenging market conditions.



In conclusion, Rémy Cointreau's 2024-25 9M sales performance reflects the challenging market conditions faced by the company, particularly in the Americas and APAC regions. However, the company's strategies to mitigate the impact of the sales decline, including tight cost controls and a new cost-cutting plan, have helped it maintain its COP margin and preserve its profitability. As the company looks ahead to the full year, investors should keep a close eye on its progress and the strategies it employs to navigate the challenging market conditions.