Report
Virginie Roumage

Rémy Cointreau: 2019/20 guidance upgraded following strong cognac performance

Rémy Cointreau: (NEUTRAL, Fair Value EUR120 (-5%))
2019/20 guidance upgraded following strong cognac performance
Rémy Cointreau unveiled strong FY 2017/18 results with a current EBIT growing ahead of expectations (+14.1% organically vs. 12.9% expected by the consensus). Cognac was the main driver given the strong performance in China and in the US, which improved mix effect, and price hikes. Net debt/EBITDA ratio strongly sharply to 1.5x from 1.8x. Given the 130bp improvement (at constant FX and scope) in current EBIT margin in 2017/18, Rémy Cointreau upgraded its 2019/2020 guidance from 80-180bps to 240-300bps improvement, implying a current EBIT margin between 23.1% and 23.7%.
Underlyings
Remy Cointreau SA

Remy Cointreau is an operator in the global wines and spirits market. Co. produces, markets and distributes Cognac, Liquors and Spirits and other non-group brand alcoholic beverages. Co.'s primary cognac brand is Remy Martin, produced from Petite Champagne and Grande Champagne eaux-de-vie. Co.'s principal liquor and spirits include the following brands: Cointreau, Passoa, Metaxa, St Remy, and Mount Gay. Co. also operates a distribution network that handles products from partners and third-party companies. Major non-group products distributed by Co. include Scotch Whiskies (Edrington brand), Champagne (Piper-Heidsieck and Charles Heidsieck brands) and Vodka.

Provider
Bryan Garnier
Bryan Garnier

Since 1996, Bryan, Garnier & Co has been growing with an absolute conviction that the investment banking landscape would experience a major revolution: most of the large local generalist banking groups will disappear to the benefit of a handful of global powerhouses, and an emerging group of independent, highly specialised boutique investment banks.

Analysts
Virginie Roumage

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