30th Sep 2021 08:48
(Alliance News) - Guinness brewer Diageo PLC on Thursday said it has made a strong start to financial 2022, with organic net sales momentum across all regions.
Shares in Diageo were trading up 2.8% at 3,660.00 pence each in London on Thursday morning.
The spirits and beer maker said this reflected "excellent execution" as it benefited from resilience in off-trade and continued recovery in the on-trade. Off-trade means sales via shops, while on-trade is sales at restaurants and pubs.
However, Diageo said it expects near-term volatility to remain, including potential future waves of Covid-19.
The FTSE 100-constituent said its North American business was performing strongly, despite some supply chain constraints, reflecting resilient consumer demand.
Business in Europe was recovering ahead of expectations, Diageo said.
Meanwhile, trade in Africa, Asia Pacific, Latin America and the Caribbean are "performing well", despite continued volatility in these markets.
The company said travel retail, such as duty free sales, continues to be disrupted.
"We expect organic operating margin to benefit from a further recovery in sales volumes, positive channel mix and premiumisation trends, while we are continuing to invest in our marketing and commercial capabilities. As previously indicated, we are managing rising inflationary pressures, which are partly due to supply chain constraints," said Chief Executive Ivan Menezes.
"I remain confident in our ability to deliver long-term sustainable growth and shareholder value," Menezes added.
By Scarlett Butler; [email protected]
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