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GUINNESS-OWNER DIAGEO has reported a growth in profits and sales this year despite a “challenging cost environment”.
According to the UK company’s preliminary results for the year to the end of June, net sales increased by 10.7% to £17.1 billion (€19.9 billion). The increase was attributed to strong organic net sales growth and favourable foreign exchange impacts.
Organic sales were up 6.5%, despite volume declining by 7.4%.
Diageo recorded double-digit net sales growth in scotch, tequila and Guinness, with its more premium brands contributing 57% of overall organic net sales growth.
Diageo’s operating profit grew by 5.1% to £4.6 billion (€5.3 billion) compared to the previous financial year. Reported operating margin declined by 147bps, but this was offset by exceptional operating items and foreign exchange.
The company said price increases “more than offset” the impact of cost inflation on gross margin.
In February, Diageo increased the price of a pint by 12 cent, while it announced a further 4 cent increase to the price of its beers last month. The price change will be applied across the whole Diageo draught beer range from 14 August.
The latest price increase was not included in these results.
Diageo chief executive Debra Crew said the results demonstrate the company’s “ability to consistently deliver resilient performance, even in challenging macro environments”.
“We have delivered strong fiscal 23 full-year results, with organic net sales growth of 6% and organic operating profit growth of 7%, both within our medium-term guidance. We expanded organic operating margin by 15 basis points in a challenging cost environment while continuing to invest in the business,” she said.
She said the company was able to “take strategic pricing actions with precision and effectiveness” due to its revenue growth management capabilities, deep consumer insights and smart reinvestment.
“Through free cash flow delivery, we increased our capital expenditure, acquired a number of brands to strengthen our exposure to attractive categories and bolstered our investment in maturing stock in fiscal 23, positioning us well for sustainable, long-term growth.”
Looking ahead to the next fiscal year, Crew said she expects operating environment challenges to persist, “with continued cost pressure and ongoing geopolitical and macroeconomic uncertainty”.
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Gentle reminder that Arthur Guinness and the Guinness family were staunch unionists, highly opposed to Irish Republicanism, that donated equipment to the British army to fight against Republicanism. Not only that, but they also aren’t Irish owned, and every red cent of profit goes abroad to the UK based Diageo.
@Sean Stevenson: Cool story bro. I’ll still be throwing back a rake of the black stuff at the Galway Races this week.
@Sean Stevenson: Why stop at Diageo? Keep going up the chain. You will find that the major shareholders are also major shareholders in almost every other major industry on Earth. There is a massive global network and monopoly that people rarely talk about, unless they’re “conspiracy theorists”. Investment management companies like Blackrock and Vanguard, basically own the world.
@I’m Far Right: Yup! Our alternative stouts, Murphys and Beamish, are also owned by Heineken. No large Irish owned stouts left anymore
@Sean Stevenson: Vanguard have their finger in the Heineken pie too.
@Sean Stevenson: Can you supply a reliable source for that information on AG?
Even if it were true, what relevance would it have to Diageo or its products today?
@Sean Stevenson: unfortunately yes.
I’ve tasted some of the “craft breweries ” versions of stout and any I’ve tasted are like muck. Maybe there are some good ones out there, I don’t know..
@Sean Stevenson: At least Bulmers is 100% Irish! But you can’t beat a good pint of the black stuff!
@Sean Stevenson: I like Wrasslers (now XXXX) from GBB, Oranmore Galway, also à fan of Kinnegar and Black Donkey. But have expanded the horizons into black ales and porters, also nice black stuffs
@Journal Snowflake: What has the Iveagh trust got to do with AG? It was established 3-4 generations after AG
@SF Means Sh!t 4 Free: Nothing really I suppose. But just because his great great grandson set up the iveagh trust it doesn’t mean AG himself wasn’t a unionist opposed to Irish freedom does it?
@Roy Dowling: At that time, many Catholics were ‘unionists’ because they reckoned they would get a fairer deal if ruled from London than under the existing all-Protestant Dublin parliament. On the other hand, the ultra-Protestant Dublin Corporation, for example, was against the Act of Union, therefore anti-unionist. History is complicated.
@Sean Stevenson: How about mentioning some of the good things that the Guinness family done for Ireland and particularly the people of Dublin?
@Brendan O’Brien: for starters Brendan Arthur Guinness was protestant not a Catholic. He was opposed to both home rule and the Irish rebellion in the 1790′s.
@Roy Dowling: I know he was protestant. That does not affect my point: that ‘unionist’ didn’t have the same meaning then as now.
And Ireland did have ‘home rule’ (albeit not of a very democratic type) until 1801.
Many Irish people were opposed to the 1798 rebellion, which was a disaster.
@Brendan O’Brien: So because we had home rules and the Rebellion was a disaster I should forget about the fact Auther Guinness was opposed to Ireland being free from the British? Unbelievable
@Roy Dowling: You can ‘remember’ whatever you like: no skin off my nose. But it would be simplistic to paint Guinness as some kind of unmitigated baddie. From Wikipedia:
Guinness’s primary political positions, however, concerned the rights of Catholics to fully participate in Irish politics and society. In addition to personally hiring Catholics for his brewery, and by accounts treating them fairly, Guinness advocated to overturn laws that restricted the ability of Catholics to enter certain professions, and as a member of the Royal Dublin Society, he argued for economic developments that would positively affect lower-class Catholics in agriculture and domestic industry.
@Brendan O’Brien: While opposing them having their freedom from Britain yep great. Freedom and self rule meant Catholic could have all the above you mentioned and more. B
@Roy Dowling: It doesn’t make a lot of sense to insist that people of previous centuries should have similar opinions to yours today.
@Brendan O’Brien: Where did I say he should? But clearly he also didn’t share similar opinions of other Irishmen and women centuries ago who wanted Irish freedom from the British. I’ll gladly support them over Arthur all day long.
@Sean Stevenson: Do you think that this tax going to the UK is balanced by Amazon, Google, Apple, Facebook, Microsoft and many more paying tax to the Irish exchequer on profits generated abroad ?
@Douglaslad: When pointed out to Brendan Behan that Guinness was good to Dublin, he came back with, “Dublin was good to Guinness”.
@Alan Kennedy: Due to an increased volume of UK based shareholders, C&Cs stock market listing moved entirely to the London Stock Exchange in October 2019, delisting entirely from the Euronext Dublin (formerly the Irish Stock Exchange) bourse, and changing the quotation currency to GBP (pound sterling).
Hmm….il
Had a few pints in Temple bar 2 weeks ago £8-30 a pint must start budgeting for next year again if Limerick hurlers keep winning.Different type of inflation in Temple bar.
@Willie Marty: or don’t go to that pub
@Willie Marty: They need to move All Ireland finals out of Dublin. Literally no one stays, the teams leave after the final whistle ffs. It kills the vibe, should be a festival but instead it’s a cost-saving exercise.
@thesaltyurchin: couldn’t agree more
@Willie Marty: Mad they’re charging in pounds too and not €
@Willie Marty: go to Dublin, watch the match/gig, then get the hell out as quickly as possible. Do not spend a cent more than is absolutely necessary in that tourist trap
@Willie Marty: then don’t go to Temple Bar.
@Willie Marty: 99.99999% tourists. Very, very few Irish ever drink in temple bar.
@Outdoor thread:Plenty of decent Dublin pubs outside of temple bar.
Ability to consistently rob people more like, jumping on the inflation band wagon, thieving c%%ntz, still cheaper to drink at home
if inflation is 10% and there profit only increases by 5% they essentially have decreased profit in real terms
@Damien Doherty: do you work for diageo by any chance
@Damien Doherty: or their profit went up 15% but is only 5% in real terms when it’s adjusted for inflation?
@Damien Doherty: they didn’t just make 5% profit.. they increased profit by 5%
@Tom Kelly: that’s the point he’s making, inflation outpaced the increase, however Mark also makes a good point, was that already baked into the profit? Haven’t opened the financials so not sure.
@TheGood Feign: Mark made that up in his head
@Damien Doherty: nó hé didn’t réal inflation vs absolue figures is a real thing in compiling financials. It’s all moving targets. As valid as your points are so were Mark’s. Both are legit concerns. Both exist alongside each other.
In the words of the great Brian kerr
“They’re nothing but a bunch of gougers”
@James Doyle: and in the words of Brendan Behan, “Guinness makes you drunk”.
So much for the breweries struggling and having no choice but to pass on the increase to the customers
Drinl Beamish in Weatherspoons and save a fortune
@Yoly Macaraeg: Drink craft ales in Weatherspoons and save even more
“Organic sales were up 6.5%, despite volume declining by 7.4%.”
So who benefitted from the €1 increase post covid?
If you don’t like the price, don’t buy it. One’s energy is much better spent complaining about the price of houses, electricity, gas i.e. the necessities of survival
People will complain about the price at the bar,but sit paying it anyway,if they want it to come down enough need to avoid it for a while and force it down somewhat otherwise nothings going to change.
The power of monopoly. I always liked the dog.
Their creaming off the profits.
Can’t think why the Irish buy into this burnt beer. From the uk
have your say