Finance
Global tariff threats could deal $207 million blow to Pernod Ricard
Published by Global Banking and Finance Review
Posted on February 6, 2025
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LONDON (Reuters) -Tariffs imposed by China and the United States could deal an estimated 200 million euro ($207 million) blow to Pernod Ricard's business annually, finance chief Helene de Tissot said on Thursday.
China has already imposed temporary tariffs on European brandy imports, hurting Pernod's sales of its Martell cognac brand. The impact of tariffs, which could become permanent, forced Pernod to cut its outlook for 2025 and beyond on Thursday.
U.S. President Donald Trump has also threatened 25% tariffs on goods from Mexico and Canada, as well as impose levies on the European Union, which would affect a range of Pernod products from Jameson Irish whiskey to Codigo 1530 tequila.
Altogether, assuming a 10% U.S. tariff on the EU, that could have an annual impact of 200 million euros on Pernod, de Tissot told analysts on Thursday's results call, adding around 130-140 million euros of that was related to Chinese cognac duties.
About 50% of the total could be offset via mitigation measures, de Tissot continued, some of which have already been implemented in China.
Pernod has sought cost savings, including by reducing the size of its organisation in China, she said. Other initiatives included changes to its supply chain and revenue growth management.
Earlier this week Diageo, the world's top spirits maker, estimated an around $200 million blow from U.S. tariffs for the last four months of its current financial year.
($1 = 0.9651 euros)
(Reporting by Emma RumneyEditing by David Goodman and David Evans)