CHAIRMAN’S
MESSAGE
2019/2020 was a singular year in more than one respect … like so many years have been for the Rémy Cointreau Group and its Houses, some of which are centuries-old. And it is in these unprecedented moments that the Group knows how to stay calm and agile, to prepare to rebound in the best possible way. That is why we are confident that we can emerge from this crisis even stronger, and why we are looking toward the future with ambition – the ambition to become the leader in exceptional spirits.
The 2019/2020 environment was particularly complex worldwide for the Group, as a global economic downturn combined with the threat of import tariffs in the United States and, of course, this unprecedented health crisis, which knocked the wind out of global air traffic and on-premise consumption. For the Group, the major event was the change in its governance, with the departure of Valérie Chapoulaud Floquet and the arrival of Éric Vallat as Chief Executive Officer of Rémy Cointreau.
In spite of this context, our sales held steady at above €1 billion, our profitability remained high at 21.0%, and some of our non-financial targets, such as sustainable agriculture, were met well ahead of schedule. Lastly, we are very proud of the "B-Corp" certification of our Bruichladdich Distillery, which recognises its social and environmental performance, alongside some 3,000 companies worldwide.
Along with a new management team, we are setting ourselves new financial and non-financial targets: within 10 years, the refined value strategy should enable the Group to achieve a gross margin of 72% and a current operating margin of 33%. However, it is important to us that this growth is responsible and continues to be based on the principles and values promoted by the Global Compact. Rémy Cointreau is therefore launching its "2025 Sustainable Exception" plan, with three key focus areas: sustainable agriculture, reduced carbon emissions, and ecodesign. Our objectives are clear: by 2025, to guarantee sustainable agriculture in all terroirs involved in crafting our spirits; target 100% ecodesign for our packaging; and gradually reduce our carbon emissions in line with the international ambition of "Net Zero Carbon" by 2050.
And lastly, the Group has just formalised its Raison d’Être, defining its long-term corporate mission.
In the shorter term, 2020/2021 is expected to unfold in a context that no-one can predict with certainty, but that we expect to see take two tracks. The first half should remain tense, in a situation still marked by the global pandemic and its consequences for all of our major markets. Based on a first quarter that we estimate to record an organic decrease of about 45%, and a second quarter already showing signs of recovery, but still in moderate decline, our current operating profit could fall by about 45% to 50% at constant exchange rates and scope. However, the second half is expected to benefit from a substantial rebound, one on which the Group is already focusing its full energy and creativity.
I would like to take a moment here to thank all of our employees for their remarkable solidarity, which they have expressed in numerous initiatives to help each other, on every continent, in recent months. I’d like to say how much we admire their responsiveness – their fighting spirit, even – and the community spirit they have demonstrated through their voluntary commitments in their local areas.
Finally, I want to recognise the financial efforts made and shared by everyone in this Group – from employees to members of the Board of Directors – to adapt our cost structure in this context of pressure on sales. Rémy Cointreau’s conduct stems from ethics that we are proud to share with our shareholders. I thank them for their confidence and loyalty.
