Hello, and welcome to the Rémy Cointreau Q4 sales publication call. My name is Laura, and I will be your coordinator for today's event. Please note this call is being recorded, and for the duration of the call, your lines will be on listen only. However, you will have the opportunity to ask questions at the end of the call. This can be done by pressing star one on your telephone keypad to register your question. If you require assistance at any point, please press star zero and you will be connected to an operator. I will now hand you over to your host, Luca Marotta, the CFO, to begin today's conference. Thank you.
Hello, everyone. As you've seen on the press release, full year sales were down 19.2% in organic terms, including a roughly flat performance of -0.7% in Q4. This performance reflects some positive phasing effect in China, as well as a stabilization in EMEA, following some destocking in this region in Q3. In addition, we benefited from a positive calendar effect linked to the Chinese New Year. We estimate that at around four points, i.e., around EUR 10 million. In parallel, the U.S. showed a sequential deterioration versus Q3, which was driven by some shipment phasing. As mentioned in January, we anticipated some shipment from Q4 to Q3 to optimize as much as we can our level of intermediary inventories at the end of our fiscal year.
Overall, the 12-month sales decline is split between a volume decrease of -14.6% and -4.6% of price mix effect, impacted clearly by the Americas region as a result of the sharp Cognac and the performance compared to Liqueurs and Spirits. Finally, the cost-cutting plan is right on track, and we confirm the EUR 100 million cost saving for the year. Looking at the overall sales performance by region, Americas was down 39.6% in 12 months, including a sequential deterioration in the last quarter, Q4, due to negative phasing effects both in Cognac and Liqueurs and Spirits. APAC was up +2% in the 12 months, including a significant growth in the last quarter, driven by Cognac in China, positive phasing, and as well, some calendar effect.
EMEA, last but not least, was up +7% in the 12 months. In the last quarter, sales were up strong double digits, despite contrasted trends among sub-regions and continued soft consumer trends. This was sell-in . Now, let's talk of the best approx of final sell-out, value depletions at group level over the past 12 months. In the U.S., value depletions were down mid-teens and down high- single digit, excluding the VSOP. As compared to pre-COVID level, value depletion were up +10% and increased by 45% four five, excluding the VSOP. In China, despite high comps and a complex environment, value depletions were up low single digit in the 12 months, of which plus high- single digit in the last quarter.
On a four-year basis, China value depletions were up +75% versus pre-pandemic, and were multiplied by three versus Q4 2019-2020, which is huge in terms of exit rate. Finally, in EMEA, value depletion were down low single digit this year. This represent an increase of more than +20% if you compare to 12 months in 2019-2020. Overall, at group level, the general equation, this means that 12 months value depletion grew at approximately +40%, 40, on a four-year basis, so clearly faster than sell-in, which was up +16 on the same period. Last word, in terms of organic guidance, organic guidance, I repeat, is confirmed. Now, on pages three to seven, we pick up some initiatives that have been undertaken over the quarter.
Let's start with page number three, with Louis XIII and the opening of two boutiques in freestanding stores in China, bringing the total to 10 boutiques or freestanding stores, if you want, for the brands. First one in Hefei, 5 million people, seen as the future Chinese Silicon Valley. The boutique is located in the Hefei Yintai Mall, the first and only high-end luxury mall in the town. Our 68 square meter boutique is located on ground floor among luxury brands to leverage high premium traffic. The second one, second boutique in Suzhou City, 8 million people, one of the fastest-growing city in terms of GDP per capita. The mall has opened in 2023, last year, and the boutique is also located among key luxury brands.
With these new boutiques, as Éric Vallat pointed out and said in the H1 during H1 result, the objective is to test the franchise model with the key strategic partners, Xinyu, having a strong expertise in luxury hard goods sector... Through this model, the ambition is to address Tier One and Tier Two cities in a quicker way, without any difference for the final offer for the clientele in terms of look and feel, pricing, or sell-in ceremony. Page four. Quick word on Bruichladdich, which recently reveals a new luxury redefined range, featuring first permanent high age statement whisky range, the 18- and 30-year-old single malt Scotch whiskies. So far, these new ranges have been rolled out in EMEA and the U.S., and are about to be launched in China. The new luxury refined range is conceived, distilled, matured, and bottled only on Islay.
The bottlings feature an industry-first bespoke, sustainable outer wrap. The first permanent 18-year-old single malt in Bruichladdich portfolio is an ultra-high provenance single malt whiskey. Every single element is fully traceable from farm to glass, which, for a whiskey of that age, is quite unique and incredible. The Bruichladdich 30-year-old is the story of the distillery resurrection, embodied that. The Bruichladdich story almost ended in the late 20th century, when the doors of the distillery were forced to close in 1994. Over the next seven years, the two remaining members of staff safeguarded the cask, which continued to mature in the depths of the warehouse before the distillery was restored in 2001. Bruichladdich 30 has been distilled using these high legacy cask. Bruichladdich 18 is priced at GBP 150 pound, and Bruichladdich 30 at one point...
In GBP 1,500 . At the same time, Port Charlotte unveils its first 18-year-old single malt Scotch whisky. This release, priced at GBP 178, is the oldest expression of the heavily peated single malt Scotch whisky to be released to date. So far, the results are very encouraging, as the new ranges have been well received by the trade, and sell-in has been 60%, six zero above target. Page number five. One word on the release of our latest innovation for the gin, our gin, The Botanist. Following the release of a Travel Retail exclusive, The Botanist Hebridean Strength, The Botanist has unveiled two new addition, The Botanist Cask Rested and Cask Aged Gins, inspired by reposado and tequila, indirectly.
The Botanist Cask Rested Gin is a cuvée of around 16 different cask types from a variety of regions and been aged in Bruichladdich warehouse on Islay for a minimum of six months. The Botanist Cask Aged Gin is a cuvée of around six different cask types from a variety of regions and been aged in Bruichladdich warehouse for a minimum of three years. Botanist Islay Cask Rested and the Cask Aged Gin will allow us to compete in the premium spirits category with these products, recruit new drinkers from other super premium spirit categories, catapult The Botanist into new occasion, a new type of consumer, reinforce our distilling expertise, aging credential, and provenance. Botanist Cask Rested is priced at GBP 50, and Botanist Cask Aged is priced at GBP 70.
So far, and what result, these two launches are promising, with sell-in being almost at three times bigger than our internal target. Page six. A few illustrations of the activation made in China for this Chinese New Year. Our teams have done an amazing job to support growth in a very complex market, affected by a persistent low confidence since the reopening post-COVID. As you know, Chinese New Year 2024 was not a great vintage and showed soft trends. However, our value depletion had proven to be resilient, and we continued to gain market share, led clearly by Club and XO. By channel, e-commerce has been a very efficient weapon, once again, for us to face these headwinds, boosted by our Super Brand Day on January 12, which recorded 10% of sales growth.
Our e-commerce channel grew by almost 30%, three zero, over the last quarter compared to last year. Page seven, last but absolutely not least, Travel Retail. As expected, as guided, as announced, Travel Retail sales are now back to pre-COVID level and even above that time, with sales up high single digit versus full year, fiscal year 2019-2020. This, despite the only partial recovery of the Chinese tourism. Many activation on Chinese New Year and the 300-year celebration of Rémy Martin have been done to support this strong sales acceleration in Q4. So now let's stop talk about marketing initiative. Let's talk about figure again. Slide number eight.
In moving to the 12-month sales analysis, sales amounted to EUR 1,194.1 million, down by EUR 354.3 million year-on-year, or if you want, -22.9% on a reported basis. This reflects, first, a very strong organic decline of around EUR 300 million... EUR 297.2, i.e., as said, -19.2% organic sales decrease. This performance is split between -14.6% of negative volumes, and as said, 4.6% of price mix, -1%, linked to the Americas underperformance. Regarding the latter one, this is a combination of the positive price effect, low-to-mid single-digit positive and negative mix effect around high single-digit. So pricing without mix was still positive.
Second, a negative currency translation impact of EUR 57.2 million or a 3.7% loss in the top line term of conversion for the full year 2024. This loss was largely driven by the deterioration of the Chinese yuan for EUR 30.3 million and the U.S. dollar for EUR 19.7 million. In addition, Canadian dollar, Japanese yen, and Hong Kong dollar posted a slight loss of respectively EUR 1.8 million, EUR 1.7 million, and EUR 1.1 million. On the small positive side, we have to highlight Polish zloty, British pound, and Swiss franc for less in conversion gain. On page number nine or slide number nine, the year performance by division to be compared to the 12 months, 2020. I will not detail the figures. They are all on the slide.
In a nutshell, volume performance is strongly down in Cognac amidst the current U.S. context, while price mix continues to be very strong. Overall, total Cognac sales are still up +5.8% compared to pre-COVID, including important destocking in the U.S. In parallel, at the same time, liqueurs and spirits continue to generate a significant increase in performance versus pre-COVID, driven both by volume and price mix, and all three region are clearly in very positive lengths. Now, we dig in a bit more, slide 10, into organic trend, trends by region. Let's start with APAC, whose full year organic sales were up +2%, i.e., +EUR 51.4, compared to four year ago. Looking at the volume value equation, the performance year-on-year was mainly driven by a positive price mix.
Specifically on China, China sales recorded significant growth in the last quarter, boosted by some effects. First, positive shipment phase linked to orders initially planned for December and finally booked in January. A positive calendar effect, i.e., the EUR 10 million, which is four points at group level, but thirteen points specifically at APAC level. Overall, in terms of Chinese New Year, we can say that it was really soft, but above, better than our internal expectation. Indirect channels outperformed direct channels, following meaningful destocking in Q3, as you remember, while e-commerce was once again up +30% to reach almost 25% of sales on the Q4.
Despite this context, 12-month value depletion at group level were up low- single digit versus last year, of which high single-digit in Q4, i.e., up +75% on a 12-month versus 2019-20, and if you focus only on the Q4, more than 3 times bigger than the pre-pandemic level in Q4 at that time. Consequently, at end of Q4, inventories in China are back to a clearly healthy level. Rest of Asia reported very strong double-digit growth in Q4, led by Cognac and driven by Malaysia, Singapore, and New Zealand. End of March 2024, APAC, as a global region, accounted for 40%, four zero, of our group sales, up seven points compared to last year. Second region, Americas. Americas full year organic sales were down 39.6%, i.e., -4.1% versus four years ago.
Mostly impacted by volume differences, while price mix was also negative due to the strong underperformance, so more mix than, than price, of Cognac compared to Liqueurs & Spirits. Let's talk more specifically the U.S. Sales recorded a significant important decline in the last quarter, showing a sharp sequential deterioration from Q3, impacted by, first of all, negative phasing effect both in Cognac and Liqueurs & Spirits sell-in, as we have decided to ship more in Q3 to give more time to the wholesaler to deplete or optimize as much as we can our intermediate inventories at the end of our fiscal year. Second point, a sequential visible deterioration in depletions against high comps in a, in a market still very, very promotional.
Despite a continued destocking absolute value in Q4, in terms of volumes and value even more, which bring down to the level of inventories to the level of pre-COVID, even less for some brands or for some states, in terms of wine, in terms of value, working capital immobilized by the wholesaler, by the retailers, this is not yet visible in terms of days of stock average, due to the sequential deterioration of the depletion of the quarter. I'm sure some questions will be on that. As a consequence, the level of inventory is in terms of day of coverage, if you want to this, to do some math, is still around five months overall at the end of the Q4.
On a 12-month basis, value depletion are down mid-teens year-on-year, down high single digits, including the VSOP, and approximately +10% compared to four years ago on a 12 months, +45% compared, if we compare without the VSOP. In terms of Canada performance, sales were up a very strong double digit in Q4, led by Liqueurs & Spirits and Cognac, and in parallel, Latin America was also up a strong double digit in Q4, led essentially by Liqueurs and Spirits division. End of March, Americas accounted for 38% of our group sales, down a massive 12 points compared to last year. Finally, EMEA full year organic sales were up +0.7, so slightly positive, and grew by 7.6% if you compare to four years ago.
This year-on-year performance includes a strong price mix effect, very strong, while volumes were strongly negative. Beginning by sub-region, Western Europe was up a strong double-digit in Q4, driven by some country like Greece, Spain, Austria, even on a small basis in Switzerland. Markets remain soft overall, but demonstrate a continued resilience of the on-trade channel, mainly in Southern Europe. U.K. was up mid-single-digit in Q4, led by Cognac division in a tough market, still dominated, clearly dominated by promotion and down trading. The rest of the EMEA region, sales were up at double-digit, led by Africa, Middle East, and Eastern Europe. The latter benefited from a positive phasing effect. Meanwhile, Benelux showed the same time good momentum, essentially in Liqueurs & Spirits and essentially in Cointreau, but the Cognac division was affected by peers' huge, drastic promotion.
Over the last 12 months, value depletion for the region, for EMEA, were down low single digit year-on-year, representing more than 20% of the value depletion growth versus four years ago. But as a consequence, the fork between sell-in and depletion, inventories in the region were slightly up versus the end of December. End of March 2024, EMEA region accounted for 22% of group sales, up five points compared to the previous year. Now, let's turn to line 11 and analyze it by division, starting with Cognac. Cognac posted a full year organic decline of 25.1%, reflecting a significant decline of 29.7% in volume and a strong price mix gain of 4.6% at the end of March 2024.
At the same date, end of March 2024, Cognac division accounted for 65% of our sales, more or less two-thirds, down 6 points year-on-year. Let's start to begin by the region, starting with the APAC for Cognac. Clearly, we start with China. In China, sales recorded a significant growth in the Q4, boosted by favorable phasing of shipment and positive calendar effect, over the same 10 million, which is for the Cognac division overall is waiting for seven point. Overall, the underlying trends remain a bit soft due to a low consumer confidence and persistent cash pressure in the trade.
But despite this context, value depletions, the best approx of the final consumption, have been quite resilient, up double digit in Q4 year-on-year, and I repeat, because it's massive in terms of change of gears, three times more than four years ago, driven by Club, intermediate product, and to a lesser extent, Rémy XO, which gained market share this year. On a twelve-month basis, value depletions were up at low single digits, i.e., around +7.5 versus full year 2019 to 2020. As a result, end of March, our inventory level is back to empty level. Zooming by channel, on-trade for us continue to underperform. It is a weakness over time, sometimes a strength as well, impacted by some down trading and a lower spend per capita.
Within the off-trade, banquets and key account customers are, have been more resilient, while e-commerce, as said, and I repeat it, still very dynamic, boosted by Super Brand Day in January. In parallel, we recorded a strong quarter for Hong Kong and Macau, while Taiwan was weak, impacted by some unfavorable phasing effect. Remaining part of Asia, sales grew at very strong double-digit in Q4, led by Southeast Asia, particularly Malaysia, Singapore, and Vietnam. Japan recorded a weak performance, reflecting a soft Chinese New Year. In Americas, in North America, Cognac sales recorded a significant decline in Q4, impacted by the U.S. market, while Canada was up strongly double-digit in Q4. U.S. decline reflects the continued destocking, our firm position on pricing in a persistent promotional market and a soft underlying demand.
At the same time, Q4, U.S. value depletion, so not sell-in, but value depletion, were down very strong double-digit year-on-year, with a strong underperformance of the VSOP. Strangely, the two extremes of the portfolio outperformed. On one side, with 13 back to very strong double-digit growth, and the other side, Rémy V, representing our first enterprise, even on a marginal quantity, is showing good momentum, even if I repeat, on a very marginal basis. Considering the deterioration of the depletion, the level inventories on Cognac is, as said, still around five months in terms of days of coverage. It is not absolutely the same picture, considering volume and value, in absolute value, compared to four years ago, clearly.
This includes a flat price mix effect year-on-year in the last twelve months period, ending March 2024, but on a four-year basis, price mix or value depletion is clearly up 20%. That's the reason why sometimes in your calculation, you are maybe a bit too focused on a year to go and a year to date on volumes, and you forgot for us, compared to our peers, that you have a positive accretive value on value depletion, much better than our peers. This is also the reflection of the clear strategy is sticking to that. So you pay some prices on volume, you have some benefit on value. It's visible, not only in sell-in, even more on sell-out. Latin America sales were down a very strong double-digit Q4, still impacted by fierce promotional competition.
EMEA Cognac sales were up a very strong double-digit in Q4, led by Africa, Middle East, Western Europe, and Eastern Europe. U.K. showed a good resilience in a very tough market, while, as said, the Benelux recorded strong decline in sales, impacted by very strong promotional competition. Overall, underlying demand in EMEA for Cognac remains a bit soft, as inflation is weighing on the purchasing power. Let's now turn to slide number 12. So the performance of the Liqueurs & Spirits division. This division was down more - 4.6% on organic basis on the full year, including a decline of 6.4 in volume, a positive price mix of 1.8%. At the end of March, and then weight, Liqueurs & Spirits accounted for 33%, of sales, up six points versus last year.
Now, let's review the performance by region. Let's start with North America. In North America, where sales were down a very strong double-digit year-on-year in Q4, impacted by the U.S. market, while Canada was up a very strong double-digit. U.S. trends reflect the important restocking made in Q3 to optimize our inventories at the end of March, as well as the very high comps. More specifically, on Cointreau, as you can see, U.S. value depletion were down mid- to high-single-digit year-on-year this quarter, but still almost +65% compared to four years ago, affected by tougher comps in Q4, as we were cycling adverse phasing from prior year. In addition, the current context is driven by more global general caution from retailers.
Besides that, price mix value depletion was here down four points versus last year in the last 12 months, ending March 2024, and up 10 points on a four-year basis, comparing to pre-COVID. In parallel, Latin America sales were up at a very strong double-digit in Q4, led by Brazil, Puerto Rico, Barbados, mainly Mount Gay, and the cruise business. Second regions in terms of weight for Liqueurs & S pirits is EMEA. EMEA, sales were up mid-teens in the last quarter, supported by all sub-regions, particularly Benelux and Western Europe. St-Rémy for the U.K., Brugal for the U.K., Metaxa Greece, and The Botanist in Germany are some examples of brands and countries clearly outperforming, performing better than expected and better than last year. However, markets remain soft generally overall, and highly, very highly competitive on the back of the persistent inflation.
Solid innovation pipelines, as we have seen, for Botanist, Brugal, and also one for Mount Gay, strong activation plans on Cointreau, and new listing on St-Rémy U.K., have made it possible to sustain a good momentum while holding on to existing price point, even increasing compared to the previous year. Third region in terms of weight, APAC, in which we have China. China, we posted a very strong double-digit decline the last quarter, impacted by continued stocking in whiskies, essentially, and a weakened demand, mainly from younger generation, which is proving to be more volatile for this kind of category. The rest of Asia was up high- single digit in the last quarter, mainly driven by New Zealand, Singapore, and Japan, with St-Rémy, Brugal, and Telmont, our Champagne, outperforming.
One last word, the record on the performance of the new group brands, which now represent 2% of group sales, stable year-on-year, and they were down, the new group brands, 6.1% in full year 2024. Last slide, and then I can drink.... water, not Cognac. Slide 13, I would like to reconfirm our operating profit margin guidance, organic operating profit margin guidance that we updated end of October. In a nutshell, we expect a contained organic decrease in top margin, and now EUR 7 million-EUR 10 million of negative Forex effect. Throughout the year, we kept a very tight control on cost. We maintained a firm pricing policy, and we reduced selectively our A&P, mostly for the Cognac division. More importantly, we roll out, we committed, and we are realizing a cost-saving plan of EUR 100 million.
In parallel, we don't have to forget, we protected as much as we can, our gross margin in a persistently inflationary environment, and despite a negative mix linked to the underperformance of Cognac and underperformance, mathematically speaking, of the U.S. Thanks for your attention, and now I'm happy to answer to your question after I have a bit of water.
Thank you. Ladies and gentlemen, as a reminder, if you would like to ask a question, please press star one on your telephone keypad. In favor of allowing more people to ask questions, we kindly ask you to limit yourself to two questions only. Once again, if you would like to ask a question, please press star one. Thank you. We'll now take our first question from Simon Hales, with Citi. Your line is open, please go ahead.
Thank you. Morning, Luca. So just a couple from me then. I wonder, firstly, could you talk a little bit more about China in the quarter? Clearly, you know, the performance was certainly good relative to your expectations around Chinese New Year, but how did things develop through the quarter? I don't know if you could talk about, you know, how the early part of the quarter compared to trends through March as we head into April, because it looks like things have perhaps deteriorated a little bit from a consumer uptake standpoint. So just some general broader comments on that. And then maybe sticking with the go forward commentary, you know, sort of more generally, clearly the U.S. was weaker overall than I think, you know, we expected from a depletion standpoint in Q4.
If we have got a weaker exit rate, perhaps in China, coming into the new fiscal year, how do we think about fiscal 2025? You know, when I look at consensus, I think we're looking forward to the consensus of mid-single digit organic sales growth, a little bit higher, maybe sort of a, you know, sort of 6%-7% organic EBIT growth. Are you happy with where people are sitting as you head into the new fiscal year?
So with your three questions, we can last one hour, I guess. Thank you for your questions, Simon. So, we start with China, as asked. So, as you have seen, we are satisfied with the performance of China. In a nutshell, overall, our tagline or our press release is saying sequential and improvement, which is true, because, compare also to general, competition, we can say that we are doing better in China, we are doing worse in the U.S., and for Europe, considering the size of the region, the volatility sub-region, we are doing sometimes better, sometimes worse, but overall, we can count less compared to our peers on, on Europe. So these are the general elements of the, of the, of the quarter.
So, coming back to China specifically, full year stage, we are very strong, and the Q4 was clearly stronger, what I can see of some performance of all our peers. Why that? Was clearly some soft comp, essentially in January and February, and then March, we can compare things comparable, so those are phasing positive effect in terms of comps, and EUR 10 million positive effect. But if we strip out all that, it remains a very positive performance, either in sell-in and in sell-out as well. If you remember that in end of January, we highlighted an exit rate of depletion that we're cleaning up big time, the slight overstock that Mid-Autumn Festival has determined.
So that's the reason why we can say the soft Chinese New Year, it is being realized, is not better than soft, but is above expectation, clearly, and we are... I think we are very satisfied with that. Why, so we are not so much bullish on the future on China? Because still, we have to consider there is cash pressure in the trade. There are high comps that will be cycling in the Q1 and Q2 of the new fiscal year, and the level of confidence remain a little bit blurred, a little bit low. So, we witness, we analyze, we dig in, we dissect the performance. We interpret the figures, but for China, we cannot be very bullish for the future.
We think that we are doing more than fine, and if I can, I repeat, better than our peers. But we remain humble, not swagger at all, and we look forward to continue to increase our performance in China as best we can. But we cannot commit to have this excellent rate of the Q4, clearly based on China, also replicated in Q1 or Q2 of the next fiscal year. In terms of brands and channel, I think that during the call, I gave also already some color, so I don't think I need to dig in more. Let's talk now about U.S., because it's clearly there that we still have a painful situation.
So we are clearly experiencing huge comp, huge comp compared to last year, also because of Super Bowl, which is not there the same extent. We are showing very good results compared to four year ago, but the reality is that the spark of the recovery, which is linked to the depletion, is not yet there. So this spark is essential. Depletion need to be positive again, because all the math, the compounders are linked to this indicator to be able to capitalize on confidence, on compounders, on sales, on activation, that are showing that in a very clear way. So far, it's quite the opposite in terms of depletion. Q4 is show a deterioration.
So, we have done the maximum that we can, and we'll be back on that point because it's important to highlight that, but so far the situation has been deteriorating in Q4 compared to the Q3. Why that? We want to give some elements on top of the depletion, comps, I repeat, were very high on top of the Super Bowl. The promotional environment has not loosened, quite the opposite, so we are facing also a fierce competition on that. And at the end, overall, on the longer period, strategic asset will remain what they are.
In the short period, when there's cash pressure in terms of capital return on capital rotation, in terms of wholesaler, you might prefer brands that with the promotional intensity are showing faster cycle of sell-in to the retail point of sales. So indirectly, it's likely penalizing ourself, because being firm and strict on our respecting our strategy is implying the short term that we need we need to to hold on. So on top, further deterioration in our opinion of the global U.S. spirits market. We are not yet out of the crisis in the U.S. Our better best estimation is they will be much more skewed on the H2 of the fiscal year 2024, 2025.
And U.S. are so important, they are so key, that five, 10 points of different, positive, or negative, can change all the group footprint overnight. So the volatility is very important. China is a very good news, but U.S. needs to have a spark, a positive spark, which is, in a nutshell, positive depletions in value, in value, in value. Some of you have done a very good exercise in terms of math so far this morning, to name one, Sanjeet at UBS, very good one, but is in volume. It's not in value. It is a huge mistake, because you can capitalize on value depletion, creative impact. So, sorry, I will be a little bit longer because it's important. You can say that we are passive.
You can say that we're waiting and see and look at the sky, nothing happens. We are sticking to our strategy, so we are old and lazy guys that they want to move. The opposite. We remain strict on our strategy. We remain strict on our baseline, on our credo, on our believers. So we changed the maximum what we can to improve the performance, and we are convinced we start to bear fruit. We changed the way we are doing A&P in the U.S., much more on BTL activation, moving like the needle on the point of sales and less on brand awareness. Because as you have seen, and Éric Vallat is hammering on that every time he's speaking, BHT, brand health, is the maximum level in the U.S. compared to our previous year.
So strategy is there. The consumer top-of-mind knowledge is there, so probably we need to change something, and we are changing something in terms of activation, marketing, initiatives, to be more consumer-centric, a little bit less brand overall umbrella-centric. And then, without elaborating on the economics, this is not the purpose, we made some reorganization in terms of our, the way we are approaching our marketing and our sales. It's not only an economic exercise. We're not doing that to have savings. Clearly, it's a secondary element, because we change from a regional standpoint for mirroring more the wholesaler organization, so creating new responsibility, a full P&L responsibility for our teams, a more embedded, integrated sales, marketing, e-commerce, trade marketing, a link to the wholesaler footprint. And-...
As every change needs also to have some time to unfreezing, warming, norming, performing with the low. On top, there is an increased competition, so the time, I acknowledge that, is less fast than we expected. So we are not only wait and see in terms of attitude, we stick to our fundamentals, but we are moving. I acknowledge that so far, value depletion are not showing what we want, is the spark. The spark needs to be there. When you will have it, you will have some reaction that are going beyond the mathematical compounders. You will see very strong acceleration even beyond compounders. Sorry for this long answer. So back to your third question, which is the consensus, the guidance, and so on. So let me start for the fiscal year 2022-2024.
Top line is there. It is, as you highlighted, a small, a small bit. What does it imply in terms of organic top consensus? So far, the company consensus for the year is a -28.4%. The Visible Alpha operating profit consensus is -28.8%. I'm okay with the consensus. I'm okay. What does it mean, okay? No more, no less. No more, no less. What's happening in terms of organic sales consensus for full year 2024, 2025? If you have followed me in my delirium, a long, long answer, you have understood that we have a strong belief in terms of strategy, but visibility remains quite blurred. Volatility and a fork, different fork performance between the regions and brands, quarter by quarter, are blurring even more our global visibility.
So at this stage, we cannot commit on any guidance. We have one positive element and one negative element to highlight. So let's start with the compounders of the consensus of the sales, as are shown by the company consensus is at 4.7, Visible Alpha, 4.5, and Bloomberg, a very optimistic 6.3. On the positive side, we acknowledge and we highlight the fact that the consensus and is now taking into account our natural growth, our rate of the high single digit that is clearly too optimistic for 2024, 2025. So it's clearly less than a single digit. On the negative side, coming back to my point, visibility is very, very limited. There is fog. There is fog. I cannot say nothing more clear.
I don't wanna hide myself or say, "I don't give you this figure, I will give you this figure." The visibility is limited. I commit myself to be very clear what happened, what's happening. I cannot commit to something of tomorrow, because more than ever, what will happen tomorrow is unclear. The exact timing of the U.S. recovery is key. The spark. The spark, so far, the best case scenario is a U.S. recovery in H2 of 2024, 2023... 2024, 2025. Besides all that, we didn't even close the year in terms of economics. I'm assured of this point, with Éric, with Marie-Amélie , during full year results, we'll be back clearly. So far, I repeat, I cannot give you a specific sales guidance for next year. Visibility is very limited, and not only for something that belong to our responsibility.
Global macroeconomic is very complex as well. Sorry for the longer delirium.
That's great, Luca. Thank you.
Thank you. We'll now move on to our next question from Andrea Pistacchi of Bank of America. Kindly be reminded, this is limited to a maximum of two questions only. Thank you. Please go ahead.
Yeah. Thank you, and good morning, Luca. I just wanted to follow up on the U.S., please. I mean, you've made it very clear that you, we need a spark for the performance to improve. What do you see, what do you think could be the spark? What is needed, sort of, potentially in H2 2025? Is it an improvement in the environment in the U.S.? Is it promotions, promotions easing? I mean, nothing seems imminent, as you're saying, but what do you think, what shape could this spark have? And on... This is sort of the second part of my first question, if I may, on the U.S. You say that to drive to have growth in the U.S., I think if I understand you, you really need this spark.
I mean, you need depletions to clearly inflect or turn positive. But in Q1 and Q2 in the U.S., if I haven't got the numbers wrong, you're up against some shipment comps of, like, -80%, -50% in the next couple of quarters. So on those comps, do you still think it will be, I mean, will it be difficult to deliver growth because of what is happening to depletions? And the second question, please, Luca, is on cost savings. You confirmed that this year you'll be delivering the EUR 100 million that you announced. Now, some of these cost savings are temporary, but at the same time, you'll have a positive carryover effect into fiscal 2025.
I was wondering if you could just give a bit of color on sort of what cost savings will look like in fiscal 25, even if just qualitatively. Thank you.
Thank you, Andrea, for your question. So shape the natural spark. I cannot be more clear, and if you want, dramatic than that, was the positive depletion indicator following all the activation, the change of execution in terms of how our team are addressing the market. Joint plan with our wholesaler, joint action by state, all that is there, is in place, is improved, is increasing. So, we need to show that with figures to be able to capitalize on that. And the impact on our compounders, starting with the sell-in, will be, will be even more, even stronger than what the maps will drive. And this come back to the second question. So your question is, you're phrasing the U.S. in Q1 is finger in the nose, so why you are prudent?
Because so far, the exit rate in the Q4 was bad in depletion. So even if, if you compare in terms of value, of stock and volume stock compared to four days ago, is lower, if you are, I will say if you are a retailer, you give short-term priority to the most, fast-moving, element of a portfolio that you have in it. So, once again, depletion being depressed do not announce, even if on very easy counts, to be very bold and positive. Clearly, on the positive side, is an opportunity. A clear change, I come back to the spark, can improve big time the picture, so we could be more volatile, more on the positive side. I can commit to that? No. It is finger in the nose? No, it's not finger in the nose.
Once again, Q4 showed a deterioration. I would have preferred to have, in a word, a slight release on the top line for the group, having improving depletion in the U.S. than Q4, if I had to choose. So that's the reason why you cannot extrapolate the minus 0.7% that we had at the group level overall in the Q4 as the starting point of Q1. Need to be cautious. I'm not there, I'm realistic. Cost savings, I confirm that the cost savings will be realized, will be much more precise on nature, much more quantitative, beginning of June. Part of that, more or less 60%, I highlighted, will be temporary, so will be back. So this is something that's qualitative, will have an impact on the profit and loss equation for next year.
Because, we will do a lot of things to try to mitigate this automatically negative carryover, because the long lasting are there, embedded in the, in the backbone of the new, overhead footprint, OpEx footprint. But we cannot replicate the same level. So clearly, there, there is, a potential threat that OpEx next year will, grow, at, at a speed, clearly at the same level or maybe higher than the top line, consider at the end what will be the next fiscal year. In terms of, qualitative elements, something that not everybody has caught, these, these are not net cost saving, the EUR 100 million. Gross saving, so gross saving.
So it means that part of the EUR 100 million also has been put to continue to finance some strong A&P, some strong manufacturing investment projects, some strong OpEx, specific head count recruitment. So it's a gross, gross global impact, not a net one. Has been used also to improve the footprint of the profit and loss 2020 to 2024, as we'll see in one month, and will have the same effect next year. But the carryover is there, you're right.
Thank you, Luca.
Thank you. We'll now move on to our next question from Celine Pannuti, with JPMorgan. Your line is open, please go ahead.
Good morning, Luca , I'm Celine. Thank you for taking my questions. My first question is on the U.S. Can you tell us how big is the VSOP now for the portfolio? And can you talk about the promotional intensity? I mean, you mentioned that it had worsened. I think you had promotion in the October, November, December quarter. What happened to promotion for you in this quarter? And so maybe coming back to my point on the VSOP, are you—I mean, what can be done really to make sure that you limit the mutation impact from competitors being aggressive on pricing? My second question maybe is bouncing back on what you were just saying.
Gross margin, you mentioned for this year, 20, fiscal year 2024 protection. In fiscal year 2025, can you talk about, you know, can you continue to do that if you don't have a pricing, benefit and with top line growth, maybe, a below your algorithm, can gross margins still be, flat in 2025? And then did I understand correctly that, you are mentioning that some of those costs are coming back in the P&L for, on the bottom line? Thank you.
Thanks for the four questions. So, in terms of weight is lowering and now less than 50% in terms of value, this is U.S. in total, and clearly, as you highlighted, it's very visible, our performance VSOP on last year and three ago is worse than the rest remaining part of the portfolio. Clearly, we are doing much better with the other part of portfolio, starting with 17 38. So it is still an important weight, but declining, which is part of our strategy indirectly, is a little bit sharper than what we want. I don't think saying that I'm happy with that, but it's less than 50%.
So, your second question in terms of promotion, the global environment is increases, not reducing the promotion. We had some normal promotion in OND, so no different than the usual one. Overall, I don't think that we can see easily a change of this promotional world the next coming quarter, also because globally, the U.S. spirits can be is flat +1, +2, but we have planned in some category, in some segment, we are clearly running worse than the average. So it's maybe 1, +1, +2 is including the RTD and other category that are more dynamic than Cognac so far.
So I think we continue to be a distinctive element of the market, and I repeat, we will not enter in this promotional, promotional world. As you have seen, we will be a little bit, maybe less, optimistic in term of price increase. We will moderate that. You highlighted that on the gross margin, but we will play on, on SKUs, on ranges, more in the mix, but we will not enter on a face-to-face, race with our major competitors or without naming one. Second one, which is very important in the U.S., only the U.S., but is clearly very promotional and quite, inconsistent in all prices, state by state.
If you enter in that, you end up nowhere, having lost, and you lost all your credibility, and we are doing the opposite. I repeat, the organization of the sales team has been done not for costing, also for efficiency and mirroring what we have increased in terms of distribution partner, in terms of activation A&P as well. In terms of growth margin, as you have understood, it's clearly more or less at the level of 72%, the target in terms of gross margin. We reach already a very high level.
In terms of this year and next year, you will look as more a pause because there is a clear negative mix even before pricing, linked on the performance of Cognac versus Liqueur & Spirits, as well as a negative product mix in some other parts of the world, including China, because Club is clearly beating the VSOP, but it's better to do even more of XO than Club. So Club being our jewel, has a slightly negative impact on the overall gross margin. And all that clearly is talking about gross margin in comparable environment. We are clearly not talking; it's on purpose, huh? We are not neglecting that. I'm talking directly to the Barclays note now, and not neglecting that it is a threat that is not glowing our end.
So more common investigation, we are doing what we can. We are part of the three sampled company. We think that we have done everything correctly, but at the end, you know what? I cannot master that. On a comparable basis, we are so, to come back to your question of gross margin level already at more or less 73%. So this year, next year will be a little more temperate. I cannot be precise at this stage. It depends on what will happen by brands, by region, and also on the fact that the saving, part of the saving has been done this year, the lasting one, on the manufacturing side, on the logistic side, and we cannot replicate this kind of saving forever.
So a little bit more moderate, and at the same time, last to your question, as you highlighted, there will be a negative carryover in terms of, in terms of, OpEx for the past 60% of the EUR 100 million, so more or less at this stage, EUR 60 million, but we'll be more precise at the end of the year. In terms of OpEx, that will be back. Does it mean that we will witness the profit and loss declining and entering gross margin, increasing OpEx and modest top line, and then declining bottom line? No, no, no, we will not witness that. So potential other, plan of, specific improvement of the profit and loss, next year on all lines, and don't forget, A&P are moving more on the efficiency level. Our actual situation is calling for priority choices.
Excellent. Thank you.
Thank you. We'll now move on to our next question from Edward Mundy of Jefferies. Kindly be reminded, this is limited to a maximum of two questions. Your line is open. Please go ahead.
Yes, I will keep it to two. Luca, thank you so much for some of this very interesting color. Just to sort of recap, because there's a lot here. On the U.S., you know, one of your competitors has started to see flattish consumption in the first quarter calendar and reasonably low inventories, and their spark, I guess, is to have cut prices. And it's pretty clear you don't want to enter into a promotional war, but is there a tipping point where you start to become a bit more promotional to find that spark, which then allows you to accelerate sellout trends and then allows inventories to be cleaned up? And I appreciate there's a bit of a balance between sort of the long term and short term, but do you...
Is there a tipping point where you start to, you know, cut price, and then, you know, we get, we get the inventories through? Number one. And then number two, just to sort of pick up on your last point, so I understand it correctly, that you do not expect to see declining bottom line in 2025? In other words, have we, are we close to reaching a floor on operating profit, do you think, and operating profit won't go down in 2025? Just want to sort of clarify that.
On the recap of U.S., even if the promotional intensity is slowing down, quite the opposite, it is creating more negative buzz, and also reducing, as I try to explain, our leadership call for the world said that because we are moving less fast than our peers, we will not increase our promotional intensity. We will be reducing our price increase. We'll be more playing on SKUs, we'll be more value for money in terms of offer, but no promotion. So mix, potentially, yes, no promotion. And lot, it is in our hopes and wishes, and plan for this new organization that is nearer to the trade than before. We count on that.
A&P that are much more linked to the depletion activation, and if you want volume moving, then in the past two or three years, BHT brand health tracker grant us that. We have the capital that is still there, and it's there, it's more, much, much more than ever. So no a promotional like that, but less price increase and a more direct, efficient impact of all touchpoint on a point of sales. So we want to speed up the depletion rate. So we can -- we are trying to improving, increasing, the odds to have the spark. Spark needs also that. I need to, to try to do that with my end, and then the end will be, the spark will have, will there, be there. In terms of bottom line, it is too early to talk about that. Otherwise, it's a guidance.
We talk about that in June. But this year, as you've seen, we are reducing -28.58%, but reducing operating profit more than the top line, meaning that the profitability is declining. In a contained way, but is declining. We don't want to do that at this stage for next year as well, so we will do all we can without entering into specific figures to avoid to decline in profitability next year. That will be more precise with the ROC, because at the end everything depends on the top line, top line. I can do whatever I can, the maximum as a financial director, but with -19% of top line, there is a limit also to the improving action.
Top line needs to be there a bit more than this year.
Thank you.
Thank you. We'll now take our last question from Gen Cross with BNP Paribas. Your line is open. Please go ahead.
Good morning, everyone, thank you for the question. I just back on U.S. Cognac. So, I mean, depletions have been obviously quite negative for some time now, and you mentioned that wholesalers are prioritizing some of the faster moving brands. I just wonder if you'd comment on whether you're seeing any impact in terms of the shelf space being allocated to the overall category, and to Rémy Martin? That's my first question. And then just briefly on the Liqueurs & Spirits division, you commented in the EMEA on a fiercely competitive environment and some soft markets. I just wonder if you could share some color on whether this is quite widespread or it's more intense in some specific markets. Thank you.
Thank you for your question. I get the first one, second one, if you can, repeat. The shelf space, there is some more debate, clearly. It is a little bit a state game, maybe more in some state when you are for a more, most priced SKUs behind the glass, so in a specific environment, we need to be preserved, and the other part is quite the opposite. You can see very easily that the shelf space is there, but we have our products are not present because the wholesalers did not refurbish that. So it is more state by state, but we don't see this risk so far in a clear, important way. It's not an issue so far.
Can you repeat the second one, please?
Yeah, sure. Thank you. It's just on the Liqueurs & Spirits division. I think in the EMEA, you commented on in the presentation on a fiercely competitive environment and some soft markets. I just wondered if you could comment on whether that's quite widespread across Europe, or it's in specific markets that you're seeing that?
It is a bit, all around. In some market, in which South Europe you have a stronger on-trade performance, is a little bit more moderate. In other one, like, like U.K., Belgium, where there is, more off-trade, classical, classical footprint, it is, bigger than, than in South Europe. But, overall, there is a very strong competition, in terms of, of promotional and inflation impact. So it's causing instability in term of, expectation realization, so it can be far higher, far lower. So it's more that, the point which is annoying. EMEA is experiencing, even if, it's the third region in term of weight, more than, the previous year, change and discrepancies between, forecast and realization.
It's not only in the negative side, that can be also on the positive one. It's been this year in the positive one. It's the example in the last quarter, where clearly the sell-in performance was beating what at the end we discovered being the depletion rate. So it is more complex to manage, and a high competitive price position is increasing even more this volatility. On top, it's not a mystery that we are, we have a portfolio which is even inside the company, it is not comparable to some of our peers in terms of size. So we are apart from Metaxa, Cointreau, other brands are in our whiskey, other brands are less important in terms of fight face-to-face.
There, compared to your previous question, we need to be aware that can be such a pace game, more than in the U.S. Cognac. But we have a team which is highly reactive in Europe. It is clearly on the ball every day. Because it's not the fact that they are the smallest division makes their work the easiest one, quite the opposite, because you have a lot of countries, a lot of brands, a lot of priorities. It's a very, very complex job to be in charge of EMEA region and sub-region.
Thank you.
Thank you. I'm now happy to hand it back to Luca for closing remarks.
Thank you so much. Have a nice day, see you in a month. Take the light fire because I need the spark, I want the spark to be there. Waiting for the spark at the beginning of June. Thank you so much. Have a nice day.
Thank you, Luca. Ladies and gentlemen, this concludes today's call. Thank you for your participation. Stay safe. You may now disconnect.