(AOF) – Pernod Ricard announces today that it is partnering with Casa Lumbre, creator of the Mezcal Ojo de Tigre and Whiskey Abasolo brands, and the famous musician, actor and designer Lenny Kravitz to develop Nocheluna, a spirit owned by the promising Sotol category. Distinct from tequila and mezcal, this spirit from the Chihuahua desert (Mexico) has a wide aromatic spectrum, intense and elegant. Sotol is produced from the wild plant of the same name, also called Dasylirion, harvested, cooked and fermented several years after being planted.
The result is a sophisticated balance between notes of wild herbs, dried fruits, caramel, honey and oak wood, with great minerality. It derives its unique character from the soil of the Mexican desert and the know-how of its producers.
Nocheluna aims to establish itself as the ultra-premium benchmark in the Sotol category. Its global launch will take place over the next few months, starting with the US market.
Alexandre Ricard, Chairman and CEO of Pernod Ricard, says: “Nocheluna opens up new possibilities for innovation, creativity and exploration. The history of our group is punctuated by partnerships with dynamic entrepreneurs who know how to break the codes and share our passion for high quality artisan brands.”
Nocheluna is the third collaboration between Pernod Ricard and Casa Lumbre, following the success of their partnerships for Ojo de Tigre mezcal and Abasolo whisky.
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Key points
– World number 2, behind Diageo, in wines and spirits, born in 1975 from the merger between Pernod, founded in 1805, and Ricard, in 1932;
– Activity of 8.8 billion Euros, balanced between Europe (29% of sales), the Americas (24%) and Asia (41%, split equally between China, India and the rest of Asia) and contributed 63% by the 12 strategic and international brands, 18% by the 15 strategic local brands, 13% by the 4 prestige brands and the rest by the specialties and prestige wines;
– Business model based on a decentralized organization between the head office, 6 brand companies -Absolut, Chivas, Martell-Mumm-Perrier-Jouët, Irish Distillers, Pernod-Ricard and Havana Club- and 5 market companies supporting the brands international and local;
– Capital held at 16.3% (+22% of voting rights) by the founding family, ahead of employees (1.7%), Alexandre Ricard, CEO, chairing the 13-member board;
– Very healthy financial structure, with activity generating cash flow of €1.4 billion, with net debt of €7.2 billion, i.e. a leverage effect of 1.8 at mid-2021-2022.
Challenges
– “Transform & Accelerate” strategic plan with 4 accelerators -dedicated positioning for each brand, premium and luxury services, innovation and digital acceleration;
– Digital strategy aimed at making the group a “conviviality platform”: the collection and analysis of data in the service of the offer, on each market of the “right product at the right time, for the right consumer and at the right price” / the BIG ( Breakthrough Innovation Group) in charge of breakthrough innovations modifying the codes and perception of a product or brand by the consumer / the Kangaroo Fund open to collaborators contributing “disruptive” ideas;
– Environmental strategy “S&R roadmap 2030” in 3 points: zero net CO2 emissions in 2030 for clean operations and by 2050 for all activities / preservation of terroirs through regenerative agriculture, through partnerships with + 5,000 farmers and through projects to maintain biodiversity and reuse water/circular economy towards zero waste to landfill, 100% renewable electricity on production sites and 100% recyclable or compostable packaging by 2025;
– Segment not very dependent on household consumption, hence the rise in mature countries with strong positions in white spirits, rums and aniseeds (No. 1 worldwide), whiskeys and liqueurs (No. 2), cognacs, brandies and bitters (No. 3);
– Strong pricing power giving visibility to profits and preservation of margins.
Challenges
– Strong seasonality: 2/3 of the activity achieved in the first half (July-December), 1/4 in December and sensitivity of profits to sales in Asia and the Americas;
– Russia-Ukraine war: stoppage of exports to the USSR;
– Confirmation of the strong increase in sales on 1
er
half of the 2021-22 financial year;
– 2021/22 objective of strong sales momentum, improved operating margin
– 2021-2022 dividend of € and share buyback program reinforced to €750m.
Development of the Chinese dairy industry
The Chinese government encourages the consumption of dairy products to improve the nutrition and immune defenses of the population, while seeking to reduce the country’s dependence on imports. Wishing to turn the page on the melamine infant milk scandal, which affected 300,000 babies in 2008, milk production is picking up again in the country, after ten years of stagnation. The big industrial groups (Mengniu, Yili, Youran or Modern Dairy) do not export and concentrate on a domestic market, which is growing by 4 to 5% per year. They develop very large farms and rely heavily on innovation, investing four times more than all their competitors in the world.