Chivas Brothers Wraps Up FY24 with Strong Performance, Driven by Premiumisation Strategy

Chivas Brothers, the Scotch whisky arm of Pernod Ricard, has announced its full-year results for FY24 (July 2023 – June 2024), showcasing a year of resilience and strategic success.

Despite a slight dip in net sales by 1.6% compared to FY23, the company managed a robust recovery in the second half of the year, reflecting the stabilising impact of its premiumisation strategy.

About Chivas Brothers

Chivas Brothers, a Pernod Ricard business, is dedicated to Scotch whisky. The company’s award-winning portfolio includes iconic brands like Chivas Regal, Ballantine’s, Royal Salute, and The Glenlivet.

As the world’s second-largest Scotch whisky producer, Chivas Brothers exports to 150 markets globally and is deeply rooted in the communities of Scotland and beyond.

The company has been recognised as ‘Scotch Whisky Producer of the Year’ at the International Wine & Spirits Competition in 2021 and the International Spirits Challenge from 2020 to 2023.

A Year of Stabilisation Amidst Global Challenges

The fiscal year began with a challenging first half (H1), where net sales declined by 6% due to market softness. However, the second half (H2) saw a remarkable turnaround, with a 5% growth that offset earlier losses. This recovery was largely driven by favourable pricing across Chivas Brothers’ strategic brands, which helped to counterbalance a slowdown in volume.

One significant factor affecting the company’s fiscal performance was the decision by Pernod Ricard to cease exports of its international brands to Russia at the end of April 2023. Excluding the Russian market, Chivas Brothers’ net sales for FY24 actually rose by 1.4% compared to the previous year.

Prestige Whisky Leads the Way

Chivas Brothers’ focus on premiumisation continues to bear fruit, particularly in its Prestige range, which outperformed the rest of the portfolio for the third consecutive year. Royal Salute, a standout in the Prestige category, achieved a historic high in absolute net sales, with a 5% uplift in FY24.

The brand’s 21 Year Old Signature Blend and innovative editions like the Miami Polo Edition resonated strongly with consumers, highlighting the growing demand for high-end whiskies tied to unique cultural experiences.

Resilient Performance Across Global Markets

Chivas Brothers’ broad and balanced global footprint has been key to its ability to navigate market fluctuations. The company has demonstrated a strong growth trajectory with a compound annual growth rate (CAGR) of 12% since FY21.

Ballantine’s closed the year with a 1% increase, outperforming the market in 70% of its targeted regions. Although Chivas Regal experienced a slight decline in net sales (-1.2%), it gained market share in 50% of its key markets. The Glenlivet, however, faced challenges in North America, leading to a 6% decline in FY24.

Regionally, Western Europe (+5%) and Asia, particularly Japan (+22%), delivered positive results, while Greater China showed signs of stabilisation with a modest 1% decline. Eastern Europe, excluding Russia, grew by 8%, despite an overall regional downturn of 25%. The Middle East and Africa emerged as significant growth drivers, with a remarkable 35% increase, with Turkey being a standout performer. Global Travel Retail also contributed to the overall success, growing by 4%, thanks to strong performances from Ballantine’s, The Glenlivet, and Royal Salute.

Jean-Etienne Gourgues, Chairman and CEO of Chivas Brothers, reflected on the company’s FY24 performance, stating:

“Our FY24 performance demonstrates resilience and stability, underpinned by our impactful premiumisation strategy, which delivered an upward trajectory in the second half of this fiscal year. Despite a complex geopolitical landscape and ever-changing consumer trends, we continue to deliver on our strategic vision. We are also leading from the front in sustainability, making significant investments to meet our ambitious environmental targets while expanding our capacity to meet global demand for Scotch whisky.”

Commitment to Sustainability

Chivas Brothers continues to lead the industry in sustainability efforts, making significant strides towards reducing its environmental impact. The company has cut its carbon-intensity emissions (Scope 1 and 2) by 24% since 2018. In FY24, Chivas Brothers advanced its sustainability initiatives by installing mechanical vapour recompression (MVR) technology at its Strathclyde distillery in Glasgow and completing the same at its Allt-A-Bhainne site.

Additionally, the company has partnered with Simpson’s Malt Limited and OCI Global on a pilot program to use carbon-saving fertiliser, which could reduce greenhouse gas emissions by up to 20% in the cultivation of barley and wheat for whisky production.

They have even worked with scientists to use whisky waste to save money and turn it into bio-based chemicals. It is a process that will not only help the whisky industry, but other industries in manufacturing.

Investing in Whisky

In addition to the financial news, Chivas Brothers is investing in new whisky facilities. One of their plans is to build their first whisky distillery on the Isle of Islay.

Other released data suggests that the whisky industry is booming. This includes:

• Whisky sales in Singapore increase following expanded trade opportunities in the Asia-Pacific region.
• Exports of whisky exceed £5.6billion in 2023.
• Whisky contributed £7.1 billion to the UK economy in 2023.

UKV International AG is a whisky broker and investor keeping an eye on trends in the whisky industry.

We present opportunities to our clients that they build on their passion for whisky.

Speak to a whisky expert today and start your whisky journey.