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Guinness makers post £2.75bn profit

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Guinness makers Diageo have posted profits of £2.75bn this year
Guinness manufacturer Diageo has posted profits of £2.75bn in the year ending 30 June.

The group, who produce a number of world-famous beverage brands including Bushmills Irish Whiskey, Harp Lager and Smirnoff, says the 2% rise in operating profits was driven by developing markets, which offest pressures in North America and parts of Europe.

Diageo says it is hopeful that profit growth will be stronger over the next year as it benefits from a rebound in trading.

While Europe has remained a challenging region for Diageo, it said British drinkers proved the exception as volumes rose 9% and net sales lifted 5% amid strong growth in sales of spirits and wine.

It said Guinness outperformed the beer category in Britain with broadly flat sales following the success of its Bring it to Life and 250th anniversary marketing campaigns.

Diageo said price pressure in Britain was driven by the faster growth of sales in the grocery sector, with "its competitive promotional environment".

The group was created through the merger of Grand Metropolitan and Guinness in 1997 and has more than 20,000 staff and offices in 80 countries.

Johnnie Walker was the company's strongest performing brand in the year, with its Black Label version seeing double-digit sales growth due to strong demand in developing markets.

Smirnoff sales were slightly lower amid "intense" competition in the vodka market and a 7% drop in sales in North America.

Guinness volumes were 3% lower as strong double-digit growth in South-East Asia offset a 2% decline in Europe and flat sales in Africa.

In Britain and Ireland, Guinness gained market share but sales declined as a result of the continued slump in the wider beer sector.

Marketing spend across the group was up 3%, driven by double-digit increases in the rum and vodka categories.

Rob Mann, an analyst at Collins Stewart, said the figures were in line with the lower end of previous guidance.

He added that the company's forecast of more than 2% growth this year hinged on trading in North America, where it generates around 40% of profits.

Mr Mann said: "We currently model around 3% growth but have concerns about the ability of marketing spend to drive volumes in a weak US consumer environment."

© Press Association

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At 11:25 on 30 August 2010, Phil wrote:
Has anyone an idea of the amount of profit (tax) the goverment makes a year from Diageo selling this drug ?
At 19:49 on 29 August 2010, Frosty wrote:
I've nothing against people drinking either, perhaps I should have included the word 'mostly' in my earlier statement? I know quite a few people enjoy a drink, including myself, but I know enough others who's lives have been ruined through alcohol, so it would be interesting to see how much of that £2.9 billion Diageo re-invests into the community, to help treat its addicts, rather than just taking their money and killing them. Sorry if that makes me an idiot. :)
At 12:09 on 29 August 2010, Phil wrote:
Well said Frosty. Though if people want to take the drug alcohol then it is their choice, pity the rest of get persecuted for our drug of choice!
At 15:51 on 27 August 2010, Gee dawg east belfast wrote:
frosty you are a idiot
At 20:36 on 26 August 2010, Frosty wrote:
Money made from misery.
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