Nov. 27 (Bloomberg) -- Remy Cointreau SA, France’s second-biggest distiller, reported first-half profit that beat estimates as sales of higher-priced cognac improved in China, the U.S. and Russia.
Adjusted operating profit rose 33 percent to 141.5 million euros ($184 million) in the six months through September, the company said today in a statement. The median estimate of eight analysts was 137.3 million euros.
Remy said the results were helped by good performances in Asia and the U.S. and also reported some improvement in Europe. The company sees “more moderate” growth in the second half yet aims to “substantially” increase its full-year earnings amid an uncertain economic environment. Analysts forecast a 26 percent increase in full-year operating profit, according to estimates compiled by Bloomberg.
The results are “positive,” analysts at Natixis today wrote, though the “market should not overreact to this news” as the third quarter may be tough. Remy booked sales from 2012’s Chinese New Year, a traditionally strong period for cognac purchases, in its fiscal third quarter last year, whereas the later timing of the festival in 2013 will shift sales into its fourth quarter this year.
Remy’s shares rose 1.9 percent to 84.70 euros as of 9:25 a.m. in Paris trading. The stock has gained 36 percent this year.
Organic operating profit growth was 18 percent. Operating margin, a measure of profitability, increased to 23.7 percent from 22.4 percent.
Remy, the maker of Mount Gay rum, last month reported a 13 percent increase in organic sales for the period, less than analysts expected, and said growth slowed in cognac sales in the second quarter. The company gets the majority of its revenue and profit from its Remy Martin cognac brand.
The Remy Martin cognac unit’s profit increased 27 percent on an organic basis, aided by sales of more expensive variants and growth in countries including Russia and China. Profit fell 25 percent at its Liqueurs & Spirits unit after it increased marketing spending and as economic turmoil acted as a drag on sales of Metaxa in Greece.
The company said in October that it’s in talks to buy a majority stake in Larsen, another cognac maker, as it seeks to expand its exposure to the spirit.
Remy Cointreau reports current operating profit, which excludes one-time items.
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