Diageo has said that some of its strategic initiatives are starting to pay off, prompting the world's largest spirits maker to stick to its outlook in a challenging environment and sending shares up 3% in early trade.
The company is making progress on its business plans, including in the United States, where it is trying to improve its sales and distribution channels after excess inventory had caused problems late last year, it said in a statement ahead of its annual general meeting.
Nigeria Restructure Plans
In Nigeria, the maker of Johnnie Walker whisky and Tanqueray gin is aiming to complete a deal to restructure its business model.
“Our expectations are unchanged from when we reported our fiscal 24 preliminary results on 30 July 2024. The global environment remains challenging for both our industry and Diageo," said Debra Crew, CEO of Diageo.
"While consumers continue to be cautious in this environment, we are focused on strengthening the resilience of our business through operational excellence, productivity and strategic investments to win quality market share.
"We have made good progress on our strategic initiatives, including our US route-to-market enhancements, and in Nigeria we are progressing well towards completion of the agreement to restructure our business model there."
Profit Warning
The company had warned in July that weak consumer confidence and other challenges could persist into 2025 as the group struggled to regain investor confidence after a profit warning in November.
"While Diageo’s expectations are unchanged from late July, the comments that the global industry remains challenging are unhelpful for spirits peers," J.P. Morgan analysts said in a note.
Additional reporting by ESM
