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UPDATE 1-Pernod Ricard targets slight 2009/10 profit growth

Published 11/02/2009, 02:31 AM
Updated 11/02/2009, 02:33 AM

* Targeting 1-3 percent core profit growth for 2009/2010

* Signs of improvement in certain markets

(Adds detail, background)

PARIS, Nov 2 (Reuters) - Drinks group Pernod Ricard is targeting a slight rise in profits, echoing similar guidance from rival Diageo on signs that consumer demand is slowly recovering from the effects of the financial crisis.

On Monday, Paris-based Pernod announced it was targeting 2009-2010 organic growth in profit from recurring operations of between one percent and three percent.

Pernod, the world's second largest spirits group by volume, added it remained confident in the quality of its drinks portfolio, which includes Absolut vodka and Chivas Regal whisky.

"The group highlights that, even if the general economic environment remains difficult, particularly in Europe, early signs of improvement are appearing in certain markets," Pernod said in a statement.

Diageo Plc, the world's biggest spirits group, last month kept its guidance for low single digit organic growth in operating profit for 2010.

Pernod reported a 4 percent fall in first-quarter underlying sales last month, although the result beat market forecasts and the company said it had seen early signs of a recovery in some of its markets.

Pernod shares closed down 1.7 percent at 56.79 euros on Friday, giving the company a market capitalisation of around 14.7 billion euros ($21.79 billion). The stock, which fell 33 percent last year, has risen around 14 percent so far this year. ($1=.6746 Euro)

(Reporting by Sudip Kar-Gupta; editing by Simon Jessop)

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