Drinks giant Diageo has said that its reported net sales grew 5.8% in the full year to 30 June, to £12.9 billion (€14.45 billion).
Reported operating profit was up 9.5% for the period.
The business said that all regions contributed to organic net sales growth of 6.1% at the business, driven by an improved price/mix and productivity benefits resulting from improved cost efficiencies.
'Strong Performance'
“Diageo has delivered another year of strong performance,” commented Ivan Menezes, Diageo chief executive. “Organic volume and net sales growth was broad based across regions and categories, with new product innovation being a strong contributor. We expanded organic operating margin ahead of our guidance and increased investment behind our brands ahead of organic net sales growth.”
The group said that cash flow ‘continued to be strong’ in the year, with free cash flow totalling £2.6 billion for the period, an increase of £85 million.
Shareholder Returns
The Diageo board has announced that it plans to give a return to shareholders of up to £4.5 billion between 2020 and 2022.
“Our focus on quality sustainable growth is backed by a culture of everyday efficiency that enables us to invest smartly in marketing and growth initiatives while expanding margins,” Menezes added.
“These results reflect the steady progress we are making and as we look ahead we see attractive opportunities to deliver consistent growth and create shareholder value.”
In the medium term, Menezes said that he expects Diageo to maintain organic net sales growth in the mid-single digit range and to grow organic operating profit ahead of net sales in the range of 5%-7%.
© 2019 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: European Supermarket Magazine.
