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Diageo hails resilience amid ‘volatile’ trading

Diageo CEO Ivan Menezes

Ivan Menezes: ‘we expect ongoing volatility’ (pic: Terry Murden)

Johnnie Walker to Guinness drinks group Diageo said underlying net sales – excluding currency fluctuations – grew 1%, as strong demand at retail stores in the US made up for weak business at bars and restaurants in Europe.

North America was up 12.3%, offsetting declines in other regions.

Reported net sales for the half year fell 4.5% to £6.9bn. Reported operating profit of £2.2 billion was 8.3% lower, driven by unfavourable exchange and a decline in organic operating profit.

Profit before tax fell from £2.5bn to £2.2bn.

The company said it will increase its interim dividend by 2% to 27.96p per share.

Ivan Menezes, CEO, said: “We expect ongoing volatility and disruption in the second half of the year, particularly in the on-trade channel, which will make performance more challenging.

“The medium and long-term growth drivers and opportunities for our business remain intact and I am confident in our strategy, the resilience of our business and Diageo’s ability to emerge stronger.”

New distillery

Speyside Distillers, which operates the Speyside Distillery near Kingussie, has revealed plans to relocate to a new distillery.

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