HEALTHY COGNAC SALES MAKE GOOD RESULTS FOR REMY COINTREAU

Remy Cointreau logo

Source: Jefferies International Limited

Edward Mundy

September 27, 2018

We expect a continued strong performance in the Cognac division (c.80% profits) and expect 2QE group org sales +9.0% (vs 1Q 5.9%). We like Remy's category exposure and see upside as the CEO rolls out her vision for the co as a super-premium business. While we like Remy, trading at 29.9x cal 2019 PE, shares need upgrades to perform. We remain at HOLD.

What's new? Remy reports 1H sales on 17 October. We expect 1H org sales +7.6% with 2Q +9.0% vs 1Q 5.9%. The drivers of the acceleration in 2Q, we believe, are continued robust cognac demand (we model 2Q cognac org sales +12% vs 1Q +11.1%) with benefit of easier comps, as well as some positive impact from technical effects in Partner Brands. For full details of our expectations, refer to detail within this report.

Cognac (67% sales / 81% profits) - likely to remain robust. We model 1H cognac org growth +11.6% with 2Q +12% vs 1Q +11.1%. Within this, we expect US and Europe to be a bit stronger vs 1Q. Whilst Asia depletions (sell-out) momentum is likely to be unchanged vs 1Q (vols solid DD, sales strong DD), we believe shipments (sell-in) will be more normalised. In 1Q, China cognac shipments ran modestly ahead of depletions with some inventory replenishment after the strong CNY; we expect shipments to match depletions in 2Q.

LA MAISON REMY MARTIN IN LONDON: COGNAC COCKTAIL BAR

La Maison Remy Martin Image

La Maison Rémy Martin bar at Bibendum, once a pop-up, now a permanent fixture, is a cognac cocktail bar in South Kensington, London.

La Maison Rémy Martin bar for Claude Bosi at Bibendum.
Bibendum is in Michelin House, a 1960s beaut of a building with imposing stained glass windows and an ornate interior.

La Maison Rémy Martin bar serves cognac cocktails while Bibendum head chef Claude Bosi has created a food pairing for each of the cocktail.

Where: La Maison Rémy Martin Residency at Claude Bosi is at Bibendum, 81 Fulham Road, London SW3 6RD.
Opening times: Monday to Saturday: 4:30pm to 12:00am and Sunday: 12:00pm to 11:00pm

Source: Metro UK

CONSUMER VIRTUAL REALITY AND LOUIS XIII

Louis XIII Cognac’s most recent activation is a great example of how luxury brands are aligning with meaningful causes and influencers to appeal to luxury consumers’ growing desire to feel their purchases are part of something bigger than themselves.

Luxury brands once relied on the tailored customer experience perfected at boutique storefronts on the most fashionable streets of the world’s most glamorous cities to bring their ethos to life.

With a new generation of luxury consumers interacting with brands online rather than in-person, it can be difficult for a brand to differentiate itself and play up the nuances of its legacy, heritage, and superior production.

Thus many brands from across all luxury sectors are turning to activations, or experiential marketing, as an opportunity to provide the high-level, white-glove experience that is missing in the digital customer relationship.

Read more at ...

Source:  Skift

HUGE GROWTH OF COGNAC SALES IN THE US

 

Cognac Sales Image Logo Icon

Cognac market sales could surpass the 6 million case volume in the USA.
Cognac continues to thrive in the USA with category leader Hennessy leading the way. Or dominating would be a more proper statement.

Depletion was 17% up in 2016 compare to 2015, with over 1 billion USD sales which is 5 times more than 2011 in the US.

Hennessy makes 1.6 billion USD sales of cognac/year/world and it is looking at beaking the 2 billion USD sales soon which would be the new high.

Remy Martin plays well as a 2nd with +9% sales and a volume of  823,000 cases sold in 2016.  Remy Martin is in contrast to Hennessy in particular focusing on non-VS qualities such as VSOP and 1738 Accord Royal, noting sales from Jan-Sept to be +15% with $431m worldwide, and interest for higher end cognac in the USA.

Courvoisier (owned by Beam Suntor) is the third-largest Cognac in the U.S., and advanced by 6.2% to 470,000 cases in 2016.

Martell (owned by Pernod-Ricard) ranked fourth, and crossed 100,000 cases last year on 6% growth after starting a come back in the USA in 2016. They had left to focus on China but ...
Cognac d’Ussé (a Bacardi brand) launched in 2012, made in 2016 +48% with 86,000 cases sold. It is produced by Cognac Otard not sure why Bacardi is not interested in Otard!

Source: ShankenNews

GHANA IS A NEW MARKET WITH LARGE POTENTIAL GROWTH FOR REMY MARTIN COGNAC

 

Remy Martin in Africa, Ghana

Cognac Remy Martin is like many of the major cognac houses investing in Africa.
In a recent article in Ghana Web, they discuss red carpet events in Ghana and in this article they make a very interesting presentation of Remy Martin which I am re-posting here.

===> Cognac Remy Martin is rooted in 6 core pillars:

1) Rooted in winegrowing
1724 marked the beginning of Rémy Martin, the only major cognac house to have been founded by a winegrower.

2) Rooted in family
Rémy Martin has been a family business for three centuries, run by two families who share the same values: the Rémy Martin and the Hériard Dubreuil.

3) Rooted in chalk
To craft its cognacs, Rémy Martin has made the radical choice of specializing in Cognac Fine Champagne in 1948. This means using grapes only from Grande Champagne and Petite Champagne, the two most sought after growing areas of the region, which chalky soils grow the most aromatic grapes.

4) Rooted in time
Rémy Martin already understood the magical effects of time: how a company, just like a spirit, can develop and grow finer with age.

5) Rooted in talent
Rémy Martin believes in entrepreneurship and in the talent of people, as it believes in the talent of nature

6) Rooted in harmony
Rémy Martin has a signature cognac style based on harmony thanks to the traditional use of distillation on the lees – with the residual yeast - in small copper stills.

Source: GhanaWeb

MILLENNIALS NEED EDUCATION SAYS ERIC VALLAT CEO OF REMY MARTIN

Remy Martin wants millennials in the U.S. to drink cognac. It hopes that its U.S. launch of La Maison Remy Martin, which educates consumers on the intricacies of cognac, will propel sales. Remy Martin Chief Executive Officer Eric Vallat spoke with Bloomberg's Ramy Inocencio about growing in the US and elsewhere.

<iframe src="https://www.bloomberg.com/api/embed/iframe?id=123d393b-0413-4624-9bf1-ac2ee7c06c1c" allowscriptaccess="always" frameborder="0"></iframe>

Source: <a href="http://www.bloomberg.com/news/videos/2016-10-24/getting-millennials-to-sip-cognac" target="_blank">Bloomberg</a>

AUTHENTICITY AND CRAFT EXPLAINED BY COGNAC REMY MARTIN WITH 'LA MAISON REMY MARTIN' INTERACTIVE

Rémy Martin Cognac is hosting an interactive experience which will allow the guests to immerse in the universe of Rémy Martin and its One Life & Live Them lifestyle. 

This interactive experience is called "La Maison Rémy Martin".

La Maison Remy Martin Logo

It is starting from late October to late November in 3 cities: New York, Chicago, and then Los Angeles .

The experience will consist in giving you a view into cognac; from the grapes on the vine, to the blending process, to the magical cellars where cognac is aged.

You will discover the century’s old artisanship behind cognac making with a contemporary lens through curated workshops and interactive programming.

The objective: get the millennials, largest drinking age group to experience the authenticity and quality of craftmanship needed to make cognac. They will learn about (1) Terroirs, (2) People and (3) Time.

Drinking cognac is an experience and a lifestyle.

Sources: http://www.lamaisonremymartin.com

MAX COINTREAU'S LEGACY

Max Cointreau passed away last Wednesday 19th October 2016 at aged 94.

He was a prominent figure in the wine and spirits since 1942, being related to Renaud Remy Martin, Frapin, Domaine Château de Fontpinot, Cointreau SA, Vedrenne and Gosset Champagne.

Frapin, Château de Fontpinot

His involvement in the cognac industry, and the drinks trade more widely, extended far beyond into political leadership as as a president of the National Union of Liquor Manufacturers, of the GIE Grandes Liqueurs de France and president of the Social Commission of the National Council of Wine and Spirit for eight years, and as the mayor of his home town Gensac la Pallue from 1969 to 2001.

Sources: Frapin, Imbibe, La Republic.fr

BAPTISTE LOISEAU REVEALS ITS FIRST LIMITED EDITION COGNAC FOR REMY MARTIN CALLED CARTE BLANCHE No.1

'Carte Blanche' in French means 'blank card', words used in the sense of a 'blank check' for instance.

Rémy Martin has just granted 'Carte Blanche' to his new master cellar Baptiste Loiseau to select a few casks to make a limited edition cognac named 'Carte Blanche No.1'.

Baptiste Loiseau is the cellar master of the House of Rémy Martin, who was appointed in 2014 at the age of just 34. During the years he spent perfecting his craft alongside his predecessor Pierrette Trichet, he tasted every eau-de-vie that had been set aside by previous cellar masters.

Remy Martin, Loiseau, Limited Edition, Carte Blanche No.1

Rémy Martin limited edition Carte Blanche No1 is presented in the traditional cognac bottle with a big punt at the bottom of the bottle, and in a simple yet elegant case which shows 

Rémy Martin is looking to position this cognac into the premium craft spirits.

Loiseau chose to particular casks from the Gensac-la-Pallue cellar which reveal harmonious notes of lilac and spicy notes of nutmeg. The remarkable long finish, with intense aromas of leather, incense and black tea, has given life to this powerful and refined cognac. These eaux-de-vie were bottled at 41.10% Alc. Vol. to preserve their original attributes and to create a cognac of exceptional aromatic strength and finesse.

Rémy Martin only used grapes from both the Grande Champagne and Petite Champagne, which when blended together are called the Fine Champagne.  Fine Champagne Cognac, ir regulated by French law, which means the cognac is made exclusively from eaux-de-vie of the Grande Champagne and Petite Champagne, is the only blend of two crus protected by the AOC, the Appellation d’Origine Contrôlée.

Just 7,000 numbered bottles of Carte Blanche No.1 have been created with a price of US$400 per bottle. From June 1, Carte Blanche No1 will be rolled out in DFS stores at Hong Kong International Airport, Los Angeles International Airport, New York John F. Kennedy International Airport and San Francisco International Airport, where it will remain exclusive to DFS until the end of October when distribution will be extended to selected domestic markets.

Sources: DFS, The Drinks Report

VIDEO OF LOUIS XIII COGNAC BY REMY MARTIN LOOKING AT THE FUTURE THAT IS IN A 100 YEARS IN 2115

I was very impressed by this video from Remy Martin showing an incredible story about the Louis XIII Cognac.

Remy Martin is offering a deal with Louis XIII cognac that is defying WallStreet investments mostly with today's declining market.

[vimeo 152161239 w=500 h=281]

<a href="https://vimeo.com/152161239">Rémy Martin - Louis XIII, Nature</a> from <a href="https://vimeo.com/peanutfx">PEANUT</a> on <a href="https://vimeo.com">Vimeo</a>.

It might not be my favorite cognac video but it surely got my attention. What a budget!!

Credit &amp; Authors: Director: Robert Rodriguez and Client: Mikros Image (2015)

LOUIS XIII LIMITED SERIES BLACK PEARL EDITION WAS JUST RELEASED TO CELEBRATE REMY MARTIN 140TH YEAR ANNIVERSARY

Rémy Martin has unveiled a limited edition Louis XIII Cognac in celebration of the brand’s 140th anniversary, Louis XIII Black Pearl Anniversary Edition. The blend of more than 1,200 eaux-de-vie ranging from 40 to 100 years in age is from a single 560 liter tiercon (tierçon in French exactly) taken from the Heriard Dubreuil family’s private cellars, the third of its kind released by the family in the past century.

This special limited edition Black Pearl cognac made its U.S. debut on October 30 at Alicia Keys' annual Black Ball gala, the centerpiece of an exclusive auction prize that generated $30,000 for the singer's Keep a Child Alive charity.

Remy Martin Louis XIII Black Pearl 140th Anniversary

Rémy Martin does not release the number of Louis XIII bottles produced a year and keeps this information as a company secret. The Louis XIII Limited Series Black Pearl Anniversary Edition is packaged in a metallic decanter from the House of Baccarat, with 775 decanters released worldwide at a suggested retail priced of $16,000 each.

THE NEW AD CAMPAIGN FOR REMY MARTIN V EAU-DE-VIE

On 1st of June 2014, Rémy Cointreau USA is launching a new ad campaign called 'V Fabulous' for its Rémy Martin V, i.e., the eau-de-vie model which is an unaged product that if aged it would be called cognac.

Remy Martin V, unaged grape spirit

It will include print, digital and out-of-home executions on the national and local level along with radio and television spots. Rémy launched V in 2012 in the USA only. It retails at $40, and it is making inroads as a trade-up opportunity within the ultra-premium white spirits category. Kind of Ciroc for the Riches!

SPECULATION OF COGNAC REMY MARTIN BEING ACQUIRED BY BROWN-FORMAN

Rémy Cointreau's shares have fallen by around 40% over the past year because of a slowdown in China's economy. China is an important market for Rémy Cointreau because of the amount of business they do with Rémy Martin in Asia. 

Prior to this slow down, China had accounted for around one-third of Rémy’s turnover. In the first nine months of the company’s fiscal year (ended December 31, 2013), overall sales declined by 12.3% to €964.5 million ($1.325b).

However, today Rémy Cointreau’s share price jumped on rumors that Brown-Forman was considering a bid for the French drinks group.

Brown-Forman and Remy-Cointreau

After financial blog Betaville reported on 3rd April that Brown-Forman has been working with several advisers, including Goldman Sachs, Societe Generale, Lazard Bank etc. on a potential acquisition of Rémy, and that “tentative discussions have been held between investment banking advisers to both companies,” Rémy shares rose by as much as 11% on the Euronext Paris Exchange—to more than €65 ($89)—in this morning’s early trading. By mid-day in Paris, Rémy’s share price surge had cooled, but, at around €62 ($85), they were still nearly 5% above yesterday’s closing.

Rémy Cointreau is a family-controlled company, with the Heriard-Dubreuil family holding majority ownership. Over the years, the Heriard-Dubreuils have steadfastly refused to sell, even as Rémy has at times endured more difficult conditions than it does currently, and I doubt the Heriard-Dubreuil will sell.

Brown-Forman is also a family business with 70% controlled by the Brown family in Kentucky. Jack Daniel's is by far its most famous brand (Tennessee whiskey).

Cognac makes up 80 percent of Remy Cointreau's operating profit and China 50% of it. Jack Daniel's make 50% of Brown-Forman profits.

This would be a major deal in the cognac market. I wonder if this is a 'hoax' as it is being reported by Reuters or Bloomberg also as a 'rumor' and 'speculation'.

Diageo, Pernod Ricard or Bacardi may want to get in the game too.

Sources: http://www.shankennewsdaily.com, http://www.reuters.com, http://www.bloomberg.com

DOUGIE DOG WORLD'S MOST EXPENSIVE HOT DOG IS A COGNAC HOT DOG INFUSED WITH REMY MARTIN LOUIS XIII COGNAC

We knew already of burgers infused with cognac with for instance the Hawthorne at Umami Urban by Mayer Hawthorne in Los Angeles or the Cognac Burger by Cognac Bistro in Boston.

Now comes the cognac hot dog!

Dougie Dog Cognac Remy Martin Louis XIII Infused

Dougie Dog Hot Dogs in Vancouver is serving the most extravagant (and expensive) hot dog in the world called the Luxe Dragon Dog.

The $100 foot-long Dragon Dog is infused with $2,000-a-bottle of Louis XIII cognac, topped with fresh lobster and Kobe beef seared in truffle and olive oil, and served with a secret picante sauce.

The hot dog was names Dragon Dog in honor of the Chinese New Year, which this year celebrates the year of the dragon.

This cognac hot dog is not a limited edition as it will be on the permanent menu, but you need to reserve in advance as it takes twelve hours to infuse the luxe Dragon Dog with Remy Martin Louis XIII cognac.

Dougie Dog Hot Dogs hopes to get the Guiness Book of Records to approve this entry and replace the previous winner $69  hot dog.

Source: Business Insider, by Christopher Parr

REMY COINTREAU IS NEGOTIATING TO ACQUIRE THE MAJORITY OF COGNAC LARSEN

Remy Martin has just announced negotiating the majority acquisition of Cognac Larsen.

Cognac Larsen founded in 1926, is one of the last 100% family owned cognac house controlling the full process of cognac production and is located in downtown Cognac city.

Remy Martin has already sold 202,3 millions euros from Jan-to-July 2012 which accounts for 62% of the Remy Cointreau Group sales during this period.

Société Générale Bank re-evaluated down their valuation of the stock market shares of Remy Cointreau from 93 to 79 euros. The reason is a reduced growth this trimester (+5.3%) compared to +24.4% from the previous trimester. Although they anticipate the growth to continue they do not know how much growth prospects will continue to be generated by Asian markets.

It may appear that Remy Martin is trying to access another stock of cognac and/or perhaps diversify its brand portfolio. Let's hope it is not the disappearance of another smaller house as we want to keep cognac alive in its many different forms. Diversity is key to avoid standardization and boredom.

Cognac Larsen Remy Cointreau Negotiation

Source: Bourse Le Figaro

Remy Martin Limited Edition Cognac VSOP for the Cannes' Film Festival May 22nd to 26th 2012

Cognac maker Rémy Martin has released a limited edition VSOP bottle for the Cannes Film Festival meant to evoke the golden age of cinema.

As the official sponsor of perhaps the most glamorous of film festivals, the French spirit maker has launched a new collector’s series called Gold and Light for the 65th edition of Cannes.

Cognac Paradis Remy Marting Limited Edition VSOP Cannes' Film Festival 2012.
In addition to being available at the festival itself, the classic 1-liter bottle will be sold exclusively at some of the biggest airports in the world, including Paris Charles de Gaulle, Nice, Oslo, Dubai, Beirut, New Delhi, Moscow, Hong Kong, Singapore, Tokyo, Seoul, Los Angeles, San Francisco and New York JFK.

The Limited Edition Cannes Festival 2012 VSOP is available in three formats:
 -the Collector’s 1
-liter Classic Format, 55€
-1.5 Magnum, 200€
-3L Jeroboam Format, 500€

Rémy Cointreau is the official sponsor of the Cannes Film Festival.

Source: http://pursuitist.com/epicurean/remy-martin-limited-edition-cognac-for-cannes/#ixzz1utiph7Yn

HERE IS LAST YEAR VIDEO, FOR REMY MARTIN' SPONSORING OF 2011 CANNES' FILM FESTIVAL:

The Philippines is Becoming An Emerging Market for Cognac

Cognac Paradis Freddie Roach Manny Pacquiao

The Philippines is becoming an important market for the largest cognac houses with many cognac events and promotions being organized in recent months. For instance, Remy Martin is organizing many upscale events and celebrations in Manila. In particular, with its Cognac Louis XIII they are getting a great deal of interest from the local well-to-do people.

The Philippines is a new emerging market for cognac where there is a lot of information and education that needs to be made. I note that in a recent article reporting on this subject of cognac in the Philippines that there may be some confusions still for what is cognac  "... One can rightfully say Louis XIII Grand Cognac is top of the line, for the true champagne connoisseur." By  Maurice Arcache, Philippine Daily Inquirer, Wednesday, October 26th, 2011.

It appears to me that there is a confusion between cognac and champagne, both are very prestigious and quality beverage appellations from France based on grape wines but ultimately they are two separate products that should not be associated beside perhaps in a cocktail [see French 75 cocktail]. Cognac should be more than a prestigious drink consumed for the purpose of conspicuous consumption. I strongly believe that education is key to reveal the facets of this spirit. This is the reason why it takes a long time for people to be interested in cognac as it takes a slow and involving relationship to  slowly acquire knowledge and experience with different spirits and to be able to compare and recognize the superiority of cognac.

Another recent connection between cognac and The Philippines has been Hennessy signing a multimillion- dollar agreement with the boxing legend Emmanuel “Manny” Pacquiao. [see: <a>http://tinyurl.com/3ejc3eu</a>]
Manny is the classic success story form the boxing and/or sport history. He is the kid of a large family with separated parents, he spent some times on the streets of Manila. He started a professional boxing career in 1995 when he was 16 years and became a local star boxing underweight in his weight category. What is the most amazing to me is that he has succeeded to be a world champion in four different weight classes. It is outstanding to be a world champion in just one class and I cannot imagine the sacrifices and dedication required to meet the different weights of the different classes! In addition, Manny is acting, creating music recordings, and more recently he entered in politics in The Philippines. In May 2010, Pacquiao was elected to the House of Representatives in the 15th Congress of the Philippines, representing the province of Sarangani where he is originally from.

This deal with Hennessy Cognac will not only serve the purpose of the brand in The Philippines but it will be carried into the other world markets where Mr. Pacquiao is an icon, but also through the positive image that this man carries through his successful endeavor in general.