Diageo delivered strong growth in net sales in Full Year 2021

United Kingdom | Drinks group Diageo has beaten expectations for full-year sales as it gears up for the reopening of hospitality venues across Europe. On 29 July 2021 it reported net sales of GBP 12.7 billion (USD 17.5 billion) in the year to the end of June, up 8.3 percent on the previous year, but still slightly below 2019 sales which stood at GBP 12.8 billion.

Reported operating profit increased 75 percent to GBP 3.7 billion (USD 5 billion), largely due to a significant reduction in exceptional operating items.

It has been a tough year for Diageo, not least because of the shuttering of bars in its second half. Although the strength of the group’s brands means it was able to recoup some of its losses through a huge increase in supermarket trade in some key markets, its beer sales continued to be affected.

Sales of Guinness suffered

Net value sales of Guinness were hit particularly hard. In North America, they were down 19 percent over the previous year, in Europe and Turkey they tumbled by 19 percent, due to the continuing impact of covid-19 on the on-premise, especially in Ireland (-32 percent) and Great Britain. Only in Africa, they were up 22 percent, thanks to the partial recovery of the on-premise in Nigeria. Globally, net sales of Guinness decreased by 6 percent, even though organic volumes rose 7 percent, Diageo said.

All the various beer brands and flavoured malt beverages contributed 15 percent to Diageo’s net sales (2019: 16 percent) and grew 4 percent organically – although the reported net sales movement was -4 percent.

Guinness 0.0: second attempt

Diageo also said it will relaunch its alcohol-free Guinness in the UK in September after it had a troubled start in October 2020, when the UK’s Food Standards Agency said the “product may contain mould”. Diageo voluntarily recalled all cans just weeks later and offered refunds.

 Global volume growth of Guinness (2010-2020)

Source: Statista