Sales lift, resilient off-trade and gin declines – Diageo results

Diageo has reported a 20% net sales increase for its Great Britain trading unit.

The global drinks company said today that GB sales in the 12 months to June 30, 2022 were driven by a strong recovery in the on-trade and “resilient consumer demand” in the off-trade. Spirits sales in the market grew 12%, driven by vodka, rum, Baileys and Scotch whisky. However, Diageo said sales growth was partially offset by a decline for gin.

Guinness was up 52%, driven by the on-trade recovery, as well as growth from innovation, Diageo said. Elsewhere, RTDs grew double digits, “reflecting category momentum and innovation”.

On a global level, Diageo reported net sales of £15.5 billion - a 21.4% increase on the same period a year prior. The company said the continued recovery of the on-trade, resilient off-trade and consumer trends towards premium spirits have driven performance.

“We delivered double-digit organic net sales growth across all regions and we gained or held off-trade market share in over 85% of our total net sales value in measured markets,” said Diageo chief executive Ivan Menezes. “We expanded operating margin while increasing marketing investment ahead of net sales growth and we used our strong cash generation to invest in long-term growth. I am very proud of what my 28,000 colleagues have achieved through their energy and creativity.

“In a year of significant global supply chain disruption, our double-digit volume growth demonstrates the tremendous agility and resourcefulness of our teams. Our net sales growth was across categories. We benefitted from the on-trade recovery, continued global premiumisation trends, with our super-premium-plus brands up 31%, and from price increases across our regions. I am particularly proud of the performance of Johnnie Walker, which delivered double-digit growth across all regions to surpass 21 million cases globally.”

Looking forward, Menezes said the trading environment would continue to be challenging.

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