Diageo, the drinks manufacturer, has announced a 7.0% increase in full-year operating profit to £2.044bn, on sales up 6.0% at £7.26bn for the year to 30 June.
The company, which owns Smirnoff vodka, Johnnie Walker whisky and Baileys liquor, reported a 1% drop in net sales across its brands in Britain.
It described the spirit market in Britain as broadly flat, with growth in the off trade offsetting declines in the on trade.
Paul Walsh, chief executive of Diageo, said: “We expect that organic net sales growth will be in line with that achieved in the current year and we plan to deliver organic operating profit growth of at least 7% for the year and to return a further £1.4bn to shareholders through our continuing buyback programme.”
Spirit volumes, excluding ready-to-drink, grew by 2.0%, driven by a 6.0% rise in volume of its Smirnoff vodka brand, which also reported an 8.0% rise in net sales during the period.
However, Smirnoff ready-to-drink volume declined by 19%, a rate similar to the previous year.
Total Baileys volume decreased by 2.0%, while net sales declined by 4.0%, due to increased competition in the off trade.
Baileys grew in the on trade driven by distribution gains and price increases.
Total Guinness volumes declined by 1.0%, however, net sales increased by 1%, driven by a price increase on Guinness Draught, which gained share in the on trade, growing 1.0% in volume and in net sales by 4.0%.
The company’s performance in Europe remained flat with sales of Guinness in its home base of Ireland falling 8.0%.
The fall in Ireland was offset by price increases, new sales in Russia and the promotion of Irish-brewed Guinness in the UK.
Diageo’s net sales in North America increased 7.0% to £2.5bn, while operating profit rose by 6.0% to £829m.
