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Jameson delivers another boost for Pernod Ricard

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Jameson Whiskey - Pernod-Ricard's star performing drink.

Jameson Whiskey - Pernod-Ricard's star performing drink.

Bloomberg

Jameson Whiskey - Pernod-Ricard's star performing drink.

JAMESON remained Pernod Ricard's star drink in the second half of 2013, helping to mitigate the impact of weakening Asian spending.

The Irish Distillers owner's latest half-year accounts show that Jameson sales were up 16pc in the six months to December, the company's single best performing product. The spirit has been a runaway success for Pernod since it bought Jameson owner Irish Distillers in 1998.

Despite this, Pernod was forced to lower its profit expectations after a slowdown in emerging markets impacted overall sales.

Profit growth this fiscal year is now expected to reach between 1pc and 3pc; at the time of its first-quarter results in October, Pernod anticipated growth of 4pc to 5pc.

Crackdowns on lavish spending in China weighed down sales of expensive cognacs like Pernod product Martell, traditionally used for toasts at banquets or as gifts. Sales in China fell 18pc during the period. Pernod, the second-largest drinks company in the world after Guinness owner Diageo, relies on Asia for almost half of its recurring profits.

The trend shows no signs of abating; fellow drinks maker Remy Cointreau, the maker of Remy Martin cognac, said in January it anticipated no relief from declining sales for the Chinese New Year, when expensive liquor is traditionally given as gifts.

"We remain confident in the medium and long-term potential of China, but we anticipate difficulties to persist for the full financial year," chief executive officer Pierre Pringuet said in a statement.

The company also announced a restructuring plan designed to "improve organisational efficiency" that's expected to deliver savings of €150m – and may lead to some job cuts, Mr Pringuet said.

Pernod's cost-cutting project follows a similar announcement by competitor Diageo last month. The Guinness maker said it's examining ways to reduce spending by £200m (€243m) a year by the end of 2017. Other alcohol companies, including Heineken and SABMiller, are also seeking ways to strip out costs from their operations.

Irish Independent