• Thursday, June 30, 2022

Business

White Walker raises profits for Diageo

Profits and sales at Diageo may not have been dead, but the White Walker helped them rise nonetheless, with net earnings climbing 4.6 per cent to £3.16 billion in the firm’s fiscal year that ended on June 30 (Photo: Jeff J Mitchell/Getty Images).

By: Radhakrishna N S

THE successful launch of a limited-edition Johnnie Walker whisky based on the supernatural White Walker from the TV series Game of Thrones helped Diageo boost profits, and the British spirits group announced Thursday (25) it will return billions of pounds to investors.

Profits and sales at Diageo may not have been dead, but the White Walker helped them rise nonetheless, with net earnings climbing 4.6 per cent to £3.16 billion in the firm’s fiscal year that ended on June 30.

“Diageo has delivered another year of strong performance… with new product innovation being a strong contributor,” said chief executive Ivan Menezes.

Among spirits, the sale of scotch whisky, which accounts for a quarter of the total, climbed by six per cent.

“Scotch growth was driven by Johnnie Walker, which delivered a strong performance with net sales up seven per cent, benefitting from the successful launch of ‘White Walker by Johnnie Walker’ inspired by the TV series Game of Thrones,” said Diageo.

Sales of vodka returned to growth, led by Smirnoff, while sales of gin, which includes the Tanqueray and Gordon’s brands, jumped by 22 per cent.

Beer sales, which includes Guinness, rose by three per cent.

Diageo, which just ended a share buyback programme worth nearly £3bn, announced it will return £4.5bn to investors over the 2020-2022 period.

“At first glance, you might have expected the numbers to leave investors feeling refreshed,” said Russ Mould, investment director at AJ Bell, pointing to free cash flow and earnings coming in slightly below expectations.

“A premium-priced stock like Diageo can’t afford even a modest miss on estimates if a hangover is to be avoided,” he added.

The firm’s shares were down 2.3 per cent in morning trading in London, where the FTSE 100 index of blue-chip stocks was up 0.2 per cent.

(AFP)

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