Pernod Ricard needs 12-18 months before it can determine whether the legalisation of cannabis will dent the consumption of premium spirits, the company's chief executive said on Wednesday.
"To date there is no evidence that the legalisation of cannabis will have an impact on the consumption of premium spirits. We continue to monitor it," Alexandre Ricard told the annual shareholders meeting. "We must give ourselves 12-18 months to be in a position to assess it."
Eight U.S. states, including California and Nevada, have legalised marijuana for recreational use, and Canada became the first industrialised nation to legalise recreational cannabis last month.
Some studies show consumers would buy the drug instead of alcohol if it was freely available.
Rival Constellation Brands has bought a near 10% stake in Canadian cannabis maker Canopy Growth Corp to take advantage of any future boom, as more jurisdictions consider legalising the drug.
Coca-Cola Co is also closely watching the fast-growing marijuana drinks market for a possible entry that would expand the world’s largest soft drink maker’s ambitions further away from sugary sodas.
Alexandre Ricard also told shareholders that the world's second-largest spirits market after Diageo was working on a new three-year strategy plan.
This comes after Pernod Ricard, which makes Absolut vodka and Martell cognac, exceeded in fiscal year 2017/18 the medium-term sales growth goals it had set in June 2015, the year Ricard took over as chairman and CEO.
Pernod Ricard delivered underlying group sales growth of 6% in the year ended June 30, driven by a 17% jump in sales in China. This compared with a medium-term target of 4-5% sales growth.
"Our goal is to consolidate that acceleration, to deliver a durable and profitable growth," Ricard told shareholders, without providing new targets.