Pernod Ricard accounts reveal liquor giant’s $10 million loss

French spirits and wine maker Pernod Ricard posted a $10.25 million loss from local New Zealand operations in its 2020 financial year.

That loss is a stark turnaround from the $18m profit raked in the previous year.

It’s New Zealand holding company, Millstream Equities, posted revenue of $285m in the year to June 30, an increase on $261m posted in 2019, but the company faced increased outgoings in the year, including an undisclosed additional expense of $10m.

It held assets worth $212m as of June, compared to $248m a year earlier.

The firm sold its Auckland production facility in July for $55m, notes to accounts filed with the Companies Office show.

“The financial impact of this will result in the company recording sale proceeds of $55m in the year end 30 June 2021,” the company said in a note.

In November the Herald reported that Pernod Ricard would close its Tamaki facility that bottles Brancott Estate, Jacob’s Creek and Stoneleigh wines, laying of all 90 staff working at the site as it prepared to downsize its physical assets.

At the time, Brett McKinnon, Pernod Richard global operations manager, confirmed the move, citing that to “improve operational efficiency” it had made the decision to shut the site over the next 12 to 18 months.

However, sources told the Herald the site could close as early as March.

The company said it planned to outsource production to “third party support” in Auckland and to the company’s wineries in Blenheim and the Hawke’s Bay.

E tū union team leader Raymond Wheeler told the Herald “economic headwinds” had hit Pernod Ricard, along with the loss of a couple of major contracts, which had forced the company to make the decision to close the production site.

McKinnon said then that the site was proving difficult to sustain.

“We have invested a lot in the site over the years, but with clearly ageing infrastructure, and the changing nature of the Glen Innes area, [it is] putting constraints on operations,” he said.

“The site is proving difficult to sustain in its current state and we need to evolve – this is the primary reason for the closure. It is important that we improve our operational efficiency to create the conditions to better capture growth opportunities, both now and in the future.”

Pernod Ricard is also the manufacturer of wine brand Montana, G.H.Mumm, Absolut Vodka and Malibu, among other brands.

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