The following is a summary of the Rémy Cointreau SA (REMYF) Q4 2024 Earnings Call Transcript:

Financial Performance:

• Rémy Cointreau reported a challenging fiscal year 2023-2024, with significant headwinds including a global slowdown in consumption, inflation, and a fiercely promotional market.

• Gross profit decreased by 20.6% on an organic basis, reflecting challenges such as increased production costs and a negative brand mix effect.

• Operating profit decreased by 27.8% on an organic basis. Despite this, the company implemented a significant cost-saving plan achieving €145 million in savings versus the expected €100 million.

• Net profit for the group was down 34.3% on a reported basis.

Business Progress:

• Rémy Cointreau highlighted resilience in the Chinese market with low single-digit growth and an increase in market shares in Remy Martin XO. The company also showed progress in revitalizing the brand despite current challenges.

• A significant number of product innovations were launched, which are expected to contribute to growth in fiscal year 2024-2025.

• Rémy Cointreau experienced a recovery in travel retail, with a 40% growth over the previous year, surpassing pre-2019 levels.

• Continued investment in sustainability, including achievements in reducing the total carbon footprint by 15%, and innovations in packaging and agricultural practices.

Opportunities:

• The completion of a dense year of innovation is set to drive growth with full-year impacts expected in 2024-2025, particularly from a high number of new product innovations.

• Growth in ecommerce, particularly in China, where it now represents 14% of sales, driven by strong execution and digital strategies.

• Increased focus on sustainability and evolving commercial strategies particularly in the travel retail sector, which recorded significant growth.

Risks:

• The company anticipates continued challenges in the U.S. market due to destocking, inflation, and increased promotional activities leading to a loss of market share in Cognac.

• Rémy Cointreau pointed out that the macroeconomic conditions in China are disappointing despite internal growth, indicating potential risks in market recovery expectations.

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