It may not even suspect load the boat because 104 because only regarded as a party of whitesNo doubt referred to the repair of the damaged pipelineYet most of them would still lose money this yearA technical master position that enthusiasmMathieu Blondel specialist of the firm Arthur dBeing at the crossroads seems to please himOur ability to invest remains very strongBut it all depends on the definition of incidentNamed ideo it will be proposed on May 25With the crisis, Pernod Ricard has decided to accelerate its debt. However, its fundamental strategy does Exchange, even if liquor "premium", the specialty of the group, is currently progressing less quickly than the entry-level products, indicates Pierre Pringuet to "echoes".
This morning, you announce the launch of a capital increase of EUR 1 billion, while the stock market is pretty bad. You had no other alternative
We had no obligation to this capital increase. But given a resurgence in form of the markets in recent weeks, we decided to take advantage of this opportunity. After the acquisition of the Absolut vodka, our master word is: debt. Prior to the bankruptcy of Lehman Brothers, could make large acquisitions, in getting heavily, and then to get out of debt with cash from the activity. Therefore, we conducted after the acquisitions of Seagram and Allied Domecq. Since the Lehman case, the market likes less debt. At the time, our action is "shortée", i.e. sold short by hedge funds, which takes the course down. Today, if we can accelerate the debt, it will be better for everyone. This will reduce our financial costs, and the action will be most appreciated.
But is this really the right time
Yes. We were looking for. To launch the operation, we expected that the stock market reparte, and we have a good dedication to announce. This is the case with Wild Turkey bourbon we just sell to Campari for a price equivalent to 10 times its contribution to the results of the group, while we had paid the Seagram liquor on the basis of a multiple of 8 only. Evidence that if prices are also more exuberant than a few years ago, they remain quite correct. In these conditions, there was a window of shooting, and we enjoy.
It is also the time where your Kirin Japanese partner withdrew from the capital. Why
Kirin was partner of Seagram at the Japan. He entered the capital when we had taken over the assets from Seagram. This association is at its end. We will resolve all our commercial links with Kirin, who will turn to Diageo. October 1st, our Japanese subsidiary will resume distribution of Chivas. It is a good thing, which corresponds to our model of development. We always prefer to distribute ourselves our brands, it is more profitable. Including the Japan, a difficult but nevertheless remunerative market.
Kirin disengagement is also an opportunity for family Ricard to climb to the capital, which is also a good point.
After Wild Turkey, what assets do you give
We already sold to 577 million euros of assets, or 60 of our goal. The rest will follow by a year. No question of selling our 15 strategic brands, our jewels. However, after Wild Turkey, we may assign other marks important but non-essential, without endangering our distribution network in a given country. It keeps all the critical size. We can also assign other types of real estate assets, for example.
Between the capital increase and assignments, how will evolve your debt
Our goal is to reduce our debt to a level representing 4 times the gross operating surplus in 2011, against a ratio of about 6 currently. Rating agencies today fall us into the category "cross-over", i.e. just below the category of investment. We hope to return to that although category before the summer 2011. We are on the right road.
Are you going to take the opportunity to buy competitors
Debt reduction, debt reduction Planner! Nothing else. The most beautiful brand may spend under our Windows, Iâ the not.
The turnover of the group is down 12 in the third quarter of fiscal year 2008-2009. Why such a slump
Internal growth of spirits is a decrease of 12, while that of wine reached 10 on our third quarter January-March, Editor's note. With the effect of exchange rates, and if it incorporates the acquisition of Vin & Sprit, producer of the Absolut vodka, the decline is limited to 2. The removal was much more important that the market is expected. For example, in France, the distribution has more than ten days of stock, rather than 15 days late December sales. Markets, as the Spain, where we are working with wholesalers, the comme l' Espagne, où nous travaillons avec des grossistes, les baisses declines are sometimes very important. Consumption in this country has fallen by 6. In Russia and in Eastern Europe, importers suffer the crisis of credit of head-on. At the time, our subsidiaries have become more cautious and restrict shipments to any negative signs for a client. The bulk of the removal was done in the first half, but it cannot be excluded that this continues in the United States in the second half. For historical reasons, the stocks are clearly more important than elsewhere: wholesalers have three or four months of sales inventory, retailers, two months.
Beyond inventories, how consumer final évoluet - it
The consumption of alcohol in itself is rather on the rise. This is the case in France. In the United Kingdom, it was 9.5, but at the same time, it has dropped from 7 in pubs, where it is more expensive. In the world, the decline of "we trade" is of the order of 10 to 15. However, consumption in itself constitutes 80 of sales, while consumption outside the home is only 20.
The high-end products are more affected than others
Until summer 2008, high-end products grew faster than the market. Today, the trend is actually reversed. For example, in the United States, high-end no more increases that 1, while the entry-level products gained 4.
This questioning your strategy focused on high-end
Certainly not, the development of high-end is the long-term market trend. We do not wish to have a low range products, because the margins are lower. Do not lose sight that our products fall under consumption of pleasure. Clients are attached to brands and very difficult to change.
On the other hand, we increase our prices less strongly at this time and the rise of our customers to the high-end been slowed if not stopped.
How are things in the emerging countries
Throughout the area Central and Eastern Europe, Russia and Ukraine included, has suffered greatly. Sales continue to grow in Latin America. China and the India are still growing despite the downturn.
Have you taken restructuring measures
No, there is no social plan. Only adjustments to the market here and there, but with the idea to significantly reduce the expenses of structure. We are conducting a policy of wage moderation and reducing marketing costs.
