By Dominique Vidalon and Emma Rumney PARIS/LONDON (Reuters) -Remy Cointreau's new CEO outlined a series of strategic changes on Thursday, including lowering prices to sell more cognac, and said the worst was over for the embattled French spirits maker in its key U.S. market. Shares in the maker of Remy Martin cognac and Cointreau liqueur rose more than 4% after its first-half operating profit fell by less than expected and chief executive Franck Marilly promised a return to growth in the second half. He also spelled out a plan that shifted focus to reviving volumes rather than preserving profits through high prices. Remy's stock has tanked amid years of steep sales declines, repeated cuts to sales forecasts and the scrapping of 2030 sales targets due to downturns in its major markets in the United States and China. 'START OF A NEW ERA' Marilly said the first six months had been challenging, but marked the "start of a new era" for Remy. "It is clear a transformation is needed," he told investors during his first results presentation since taking over in June, outlining a growth plan he said would be fleshed out next year. He said Remy had been too dogmatic on price in the key U.S. market in particular, where stretched consumers have turned away from cognac, and especially Remy's brands as rivals undercut it. While the worst was over in the U.S., Marilly said Remy would pursue lower prices even though it would hurt its profit margin, adding that reviving volumes was the number one priority and even small changes could make a difference. Remy would also look to improve cash generation, including by reviewing its brand portfolio, make advertising and promotion spend more effective and develop new markets, he said. Jefferies analyst Edward Mundy said investors "need proof that earnings have hit their lows and that current challenges are temporary", following Remy's announcement. (Reporting by Dominique Vidalon; Editing by Alessandro Parodi, Christopher Cushing, Louise Heavens, Conor Humphries and Alexander Smith)
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