* FY 2021/22 sales 1.313 bln euros, up 27.3% organic
* Keeps for "very strong" growth f'cast in 021/22 profit
* CFO eyes double-digit organic sales growth in Q1 2022/23
* Shares up 3%, accelerating gains
PARIS, April 29 (Reuters) - French spirits group Remy
Cointreau said on Friday it was confident over
prospects for this year, predicting a strong start to business
in its first quarter to June amid COVID-linked restrictions in
key market China.
For its fiscal year ended March 31, the maker of Remy Martin
cognac and Cointreau liquor kept a forecast for "very strong"
organic growth in operating profit as it reported a sales rise
of 27.3%, in line with expectations.
Due to higher marketing and communication spending and a
tougher comparison base in the second half, year to March 2022
profits - which Remy will unveil in June - would be driven
solely by first-half growth, the group reiterated.
The market consensus is for organic operating profit growth
Finance Chief Luca Marotta told analysts that fiscal year
2022/23 would be "a strong year of pricing power at group
level," with cognac price increases in a high single to
double-digit range in the United States.
The company was also targeting double-digit organic sales
growth in the first quarter, notably driven by U.S. revenues, he
The pandemic has helped Remy's drive towards higher-priced
spirits to boost profit margins long term, accelerating a shift
towards premium drinks, at-home consumption, cocktails and
"Its high-end positioning, the strong level of desirability
of its brands and the rarity of its eaux-de-vie and aging
spirits give it excellent pricing power," the group said in a
"Q4 sales broadly in line, confident tone on outlook despite
China lockdown should re-assure," Credit Suisse analysts wrote
in a note.
Group sales for the year were 1.313 billion euros ($1.38
billion), an organic rise of 27.3% in line with a
company-compiled consensus, thanks to strong demand for premium
cognac in China, the United States and Europe.
Full-year sales at the Remy Martin division, which makes the
bulk of group profit, rose 26.3%. In China, cognac sales grew at
a double-digit rate.
In the fourth quarter alone, organic cognac sales fell
16.7%, compared with expectations of a 15.9% decline.
This reflected a previously flagged voluntary management by
the group of its strategic inventory ahead of sharp April 1
price increases, as well as the impact of COVID-related lockdown
measures in China in March. In mainland China alone, cognac
sales showed a double-digit fall in the fourth quarter.
Larger spirits rival Pernod Ricard said on
Thursday that COVID-19 restrictions in China, the war in
Ukraine, and a normalization of its U.S. business could mean
softer sales in its April-June fourth quarter.
($1 = 0.9505 euros)
(Reporting by Dominique Vidalon; Editing by Sudip Kar-Gupta,
Subhranshu Sahu, Bradley Perrett and John Stonestreet)