26th Feb 2020 08:34
(Alliance News) - Diageo PLC on Wednesday warned of a significant dent to profit and sales due to the coronavirus outbreak in China.
The Johnnie Walker whisky maker expects a negative impact on organic net sales for its year ending June in the range of GBP225 million to GBP325 million. Diageo has guided for organic operating profit to be knocked in the range of GBP140 million to GBP200 million.
Diageo said the final impact will be determined by timing and the pace of recovery in China as well as several other Asian countries such as South Korea, Japan, and Thailand.
The company said these estimates exclude any impact of coronavirus on other markets, with Diageo saying it is "difficult" to predict how coronavirus will spread.
"We remain confident in the growth opportunities in our Greater China and Asia Pacific business. We will continue to invest behind our brands, ensuring we are strongly positioned for the expected recovery in consumer demand," the company said.
In January, the company had said it was expecting financial 2019 organic net sales growth to be towards the lower end of its mid-term guidance range of 4% to 6%.
Diageo shares were trading 1.1% lower in London at 2,930.00 pence each on Wednesday.
By Loreta Juodagalvyte; [email protected]
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