By Andrea Figueras

Shares in Pernod Ricard jumped after the company confirmed its mid-term outlook and posted first-half sales that met expectations.

At 0830 GMT on Thursday shares traded 5.7% higher at EUR163.60.

The French distiller booked sales of 6.59 billion euros ($7.07 billion) for the six months to Dec. 31, an organic decline of 3% compared with the year-ago period, but in line with Visible Alpha consensus.

Net profit slipped to EUR1.57 billion from EUR1.79 billion previously, ahead of analysts' projections of EUR1.45 billion, according to a Visible Alpha poll of estimates.

First-half results were solid and in line with expectations, despite investor fears to the contrary, Citi analysts wrote in a research note.

The company backed its mid-term financial targets, including reaching the upper end of between 4% and 7% of net sales growth and organic operating leverage of 50 to 60 basis points.

The encouraging outlook, coupled with a robust first-half performance, should drive a re-rating of the stock, the analysts said.

However, the maker of Absolut vodka and Martell cognac cut its expectations for 2024 and said that it now expects broadly stable organic net sales in 2024, while it previously anticipated broad-based and diversified organic net sales growth.

"With downgrades already widely anticipated by investors, this unlikely to weigh on the shares today," Citi analysts said, though adding that the new guidance for 2024 will prompt small cuts to consensus estimates.

Write to Andrea Figueras at

(END) Dow Jones Newswires

02-15-24 0352ET