Steady growth for Diageo
financial year ended 30 June 2002 the company had delivered
continued profitable top line growth, reports Dow Jones.
UK drinks giant Diageo announced on Monday that during the financial year ended 30 June 2002 the company had delivered continued profitable top line growth, reports Dow Jones.
In the second half, the performance of the four major markets, North America, Great Britain, Ireland and Spain, was in line with expectations.
However, the volume performance in key markets in the second half was influenced by the worsening economic and political situation in Latin America.
Stock level reductions, distributor realignments and the decision to increase prices as a result of currency devaluation in key markets have adversely affected the overall volume performance of Johnnie Walker Red, local priority and category management brands. There has been little overall change in the performance of the venture markets.
Volume growth of the global priority brands (excluding ready to drink products) has improved year on year. In line with previous statements, volume growth in J& B, which had seen buying-in in Spain in the first half ahead of a price increase, slowed in the second half, as did the volume growth in Baileys.
Volume growth of global priority brands has slowed down slightly as a result. Stronger performance by both Johnnie Walker and Guinness in the second half has reversed the volume declines reported in the first half.
Diageo predicts that the full year results will show continuing profitable top line growth driven by growth in its major markets, growth in the eight global priority brands, and success in innovation.
The trading results of the second half have benefited from the addition of the Seagram businesses acquired in late December 2001 . The performance of the Seagram brands in the period has met all expectations and laid the platform for their successful integration into Diageo, said the company.
Diageo's strategic realignment behind premium drinks was substantially completed in the year. The Pillsbury disposal was completed in October 2001 and the acquisition of the Seagram spirits and wine business was completed in late December 2001.
CEO Paul Walsh said: "Diageo has achieved the objectives we identified at the beginning of this year. Our performance will benefit significantly from our newly acquired brands, particularly Captain Morgan, Crown Royal, Windsor and Cacique."