Diageo reports GB net sales up 2%

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Diageo has reported net sales in Great Britain grew 2% for the six months ending 31 December 2019.

Overall, Diageo reported net sales increased 4.2% to £7.2bn with operating profit rising 0.5% to £2.4bn, with organic growth partially offset by adverse exchange, exceptional operating items and acquisitions and disposals, say the company. All regions contributed to broad based organic net sales growth while organic volume grew 0.2%. Organic operating profit grew 4.6%, ahead of organic net sales, driven by productivity benefits from everyday cost efficiencies and strong price/mix, partially offset by cost inflation and upweighted marketing investment.

Chief executive Ivan Menzies said, “During the half, we returned £1.1bn to shareholders via share buybacks, as part of our plan to return up to £4.5bn of capital to shareholders for the period FY20 to FY22. We have also delivered another half of solid free cash flow at almost £1bn. These results reflect the changes we are making in the business to drive shifts in our culture.

“For the full year, we therefore expect organic net sales growth to be towards the lower end of our 4% to 6% mid-term guidance range. We continue to expect organic operating profit to grow roughly one percentage point ahead of organic net sales. There is ongoing uncertainty in the global trade environment and we would not be immune from further policy changes.”

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