By Dhirendra Tripathi
Investing.com – Diageo stock (LON:DGE) traded 2.5% higher in London as the world's biggest spirits distiller said it expects organic net sales growth of at least 16% in the first half of its ongoing financial year.
At a capital markets day presentation for investors, he maker of Johnny Walker whisky and Casamigos tequila also raised its medium-term guidance for sales growth by one percentage point to a range between 5% and 7% a year through 2023-2025. It now expects operating profit to grow by between 6% and 9% a year in that period.
That outlook suggests it expects last year's pandemic-induced acceleration in sales to be sustained, despite the gradual return to normal life in many of its biggest markets, even though year-on-year growth in the second half of the current year will slow due to base effects.
"We believe our sales growth trajectory has accelerated, underpinned by the strength of our advantaged position across geographies, categories and price tiers," CEO Ivan Manezes said.
Diageo’s reported net sales in the last financial year were 12.7 billion British pounds (around $17 billion).
The company expects North America to lead sales with over 20% organic growth, driven by spirits taking a larger share of the overall alcohol market and by the replenishment of stock levels by distributors and retailers.