Pernod Ricard (RI) H2 2026 earnings summary

Executive summary

• FY26 faced a challenging environment with organic net sales down 3.9% (reported -14.2%), softness in the US and China, and Middle East conflict impacting Q4, partially offset by growth in India and other regions.

• Operational efficiency program delivered €500 million in FY26, with the full €1 billion target now expected by FY28, one year ahead of plan.

• Free cash flow increased by 6% to €1.2 billion, with cash conversion at 91%.

• Dividend maintained at €4.70 per share, with a final dividend of €2.35 offered in cash or shares.

Financial highlights

• Net sales: €9,404m, down 3.9% organic and 14.2% reported, mainly due to currency and perimeter impacts.

• Profit from recurring operations: €2,423m, down 5.2% organic and 17.9% reported.

• EPS at €5.85, down 19% year-over-year.

• Group share of net profit declined 26%, mainly due to higher non-recurring charges from restructuring.

• Gross margin fell to 58.4%, down from 59.5%, due to adverse price/mix, tariffs, and COGS inflation.

Outlook and guidance

• FY27 organic net sales expected to be broadly stable, with continued softness in the US and China, but ongoing strong growth in India and other markets.

• Medium-term framework targets organic net sales growth at the lower end of +3% to +6% per annum through FY29.

• Organic operating margin expansion expected, supported by €1 billion operational efficiencies by FY28.

• Strategic investments capped at €700 million, with cash conversion targeted at 90%.

• Net debt/EBITDA ratio targeted below 3x by FY29.