Diageo has reported sales up 8.3% to £12.7bn with strong organic growth offset by an adverse foreign exchange impact, while operating profit increased 74.6% to £3.7bn, in the year to 30 June 2021.
Chief executive Ivan Menezes said, “I believe that our foundation, built through outstanding brand-building, active portfolio management, consumer-led innovation, smart investment in data analytics tools and embedding a culture of everyday efficiency, has been a key competitive advantage for Diageo. We were well-positioned to successfully manage the challenges created by covid-19, we have responded quickly to changing consumer trends and we have emerged stronger.
“A key priority has been supporting the hospitality sector through the pandemic, including our $100 million global fund to enable the safe re-opening and recovery of pubs and bars. We have also built on our successful ESG track record with the launch of ‘Society 2030: Spirit of Progress’, our new ten-year action plan to shape a more sustainable and inclusive business.
“While our business has recovered strongly in fiscal 21, with net sales growth on a constant basis ahead of fiscal 19 in three of our five regions, we expect near-term volatility in some markets. However, I remain optimistic about the growth prospects for our industry, with spirits continuing to gain share of total beverage alcohol globally and premiumisation trends remaining strong. I believe Diageo is very well positioned to capture these exciting opportunities to drive long-term sustainable growth and shareholder value.”
Belhaven owners Greene King has reported £1,051 million in revenues in the last six months, up 1.9% on the previous half, after a strong sales performance from its Pub Company. Group profit before tax and exceptionals was £128.2 million, up fractionally from £127.9 million.
Pub Company recorded growth of 2.7%, while Greene King branded local pubs traded well, with like-for-like sales of 4.9%. The Pub Partners division net income was ahead of last year and Brewing & Brands revenue was up 7.5%, helped, say the company, by the good summer weather.
Pub Company also delivered total sales of £850.3 million, up 1.6% from 2.4% fewer pubs. Average weekly take per pub was £20,600 up 4.0%, reflecting the programmes to improve sales, as well as the good weather and the World Cup. Like for like sales were up 2.7%, driven by higher drink volumes.
Pub Company operating profit was £134.2 million, down 2.0%, and the operating profit margin was 15.8%, down 0.6% pts, due to cost inflation.
Pub Partners revenue was down 1.3% to £90.9 million due to 4.6% fewer pubs trading year-on-year. Pub Partners operating profit margin was down 1.8% and profit was down 1.0%, due to higher central costs, including one-off legal costs.
Brewing & Brands revenue was up 7.5% to £110.0 million and operating profit was up 1.4%, while the operating profit margin was down 0.9% due to mix, with an increased sales contribution coming from third party beers.
The group, which acquired Belhaven in 2005 and is gearing up to celebrate the brewery’s 300th anniversary next year, posted a 0.2 per cent rise in adjusted profit before tax, at £128.2 million. The interim shareholder dividend was maintained at 8.8p.
Greene King was founded in 1799 and is headquartered in Bury St. Edmunds, Suffolk. It currently employs around 39,000 ‘team members’ across its main trading businesses; Pub Company, Pub Partners and Brewing & Brands.
The company brews quality ale brands from its Bury St. Edmunds and Dunbar breweries. Its industry-leading portfolio includes Greene King IPA, Old Speckled Hen, Abbot Ale and Belhaven Best.
Despite an increase in revenues of 6.2% to £790.3m (2015: £744.4m) and favourable like-for-like sales (+2.9%) J D Wetherspoon Interim results for the 26 weeks ended 24 January 2016 show a 10.8% dip in operating profit. This was due, said the company mainly to “ a lower gross margin and higher rates of pay for pub staff.”
JD Wetherspoon boss Tim Martin, also revealed that, “In the six weeks to 6 March 2016, like-for-like sales increased by 3.7%, with total sales increasing by 5.7%.”
He said, “Sales comparisons in the second half of the financial year will be slightly more favourable, although further wage increases are due in April. As a number of companies have indicated, the pub and restaurant market is highly competitive, but we are aiming for a reasonable outcome for the financial year.”
Tim Martin also used the publication of the interim results to voice his support of Brexit, and re-iterated his concerns re taxation. He said, “As previously highlighted, the biggest danger to the pub industry is the continuing tax disparity between supermarkets and pubs. There is a growing realisation among politicians, the media and the public that pubs are overtaxed and that a level tax playing field will create more jobs and taxes for the country.
“A wide debate is taking place as to whether the United Kingdom should leave the European Union. I have written an article on the subject, favouring withdrawal from the Union, since returning power to the national parliament will increase the level of democracy and accountability.”
Wetherspoon currently operate in the region of 74 outlets in Scotland with The Booking Office opening in Edinburgh in May and The Paddle Steamer in Largs in June.
Whitbread has revealed that profits rose nearly 14% in the first half of the year as new openings and growing demand at both its Premier Inn hotels and the Costa Coffee chain helped send sales up strongly.
Whitbread said its underlying pretax profit rose to £291.3m in the six months to August 27.
JD Wetherspoons (JDW) has released its pre-close statement for the financial year up to 26 July 2015. Reports indicate that the full year profit is unlikely to be higher than last financial year’s figure of £79.4m. The operating margin in the 11 weeks to 12 July 2015 was 7.0%, compared with 8.3% in the same 11 weeks last year.
The company has recently opened 26 new pubs and disposed of six since the start of the financial year. There are nine new bars under development and plans of opening around 30 venues within the current financial year. JDW also recently announced that they intend to sell 20 pubs which no longer fit the company’s requirements.
Isle of Arran Distillers has reported record results in its latest annual accounts. The figures to the end of 2014 reveal that turnover rose by 21% and net profit increased by 51% – the best performance posted since the business started in 1995.
Success is being driven by brand sales that are ahead by 25%. Managing director, Euan Mitchell, is delighted with the year-end results, saying, “In a challenging period for Scotch whisky our continued growth is testament to a focus on quality and a clear strategy well executed.
“Some people believe when the big companies in the industry sneeze we all catch a cold but this is not our experience. Interest in smaller, independent brands such as ours is surging and we are not even scratching the surface in global terms.”
Montpeliers, the Edinburgh-based, award winning leisure group, has reported pre-tax profits of £1.44m for the year to April 2014 on £15.44m in sales. The results according to the group were “ahead of expectations”.
Its Indigo Yard and Montpeliers outlets which were refurbished during the year to offer more of a craft experience have both traded beyond, its “most optimistic expectations”. The group also reduced its net debt by £1.1m during the year, from £7.08m to £5.98m.
Wallaces Express profits dipped slightly from £3.03m in 2012 to £2.42m according to accounts for the year ended 31 March. The company, in which Tennent’s owner C&C Group took a 50% stake earlier this year, said the results were “satisfactory.” Wallaces Express employed an average of 286 staff in its last financial year, compared with 295 the year previously. Directors’ remuneration totalled £383,727, with the highest paid director receiving £228,465.
Brewdog saw turnover rise by 80% in 2012 to £10.7m with pre-tax profits up 15% to £485,936 according to figures lodged at Companies House. The brewer/pub operator is currently raising £4m through crowd-funding the third round of its “Equity for Punks” funding scheme. Website ‘This is Money’ did the sums on the share offer…it said, “In exchange for your £95 you’ll become one of 42,105 ‘B’ Shareholders. If the fundraising goes to plan the value of these shares will be £4million, which BrewDog says represents 3.6 per cent of the company… the £95 asking price puts a value on BrewDog of around £111million. That’s a lot for a company that made £437,000 last year and would value BrewDog more highly than many companies in the FTSE AIM 100 or even the FTSE Small Cap index.”
Diageo is set to report a 5% rise in annual profits to £2.9bn on Thursday, on sales of £10.1bn.
Sales are expected to have remained tough in Europe, where Guinness sales fell 6% in the first half.
UPDATE
•Stronger second half performance with improved price/mix and operating margin expansion led to 5% organic growth of net sales and operating profit for the full year. Volume growth remained at 3%
•Volume growth and price/mix driven by 16% growth in scotch in the emerging markets and 24% growth in the reserve brands portfolio in the developed markets
•Gross margin expansion of 70 basis points driven by improved mix in emerging markets and North America, and efficiencies across our Global Supply operations
•Organic marketing spend up 8% to 15.5% of net sales, mainly in emerging markets and for key spirits brands in the United States
•Continued strong free cash flow of £1.7 billion
•Recommended increase in the final dividend of 6%
•In May Diageo announced an operating review which is expected to reduce cost of goods and operating costs by approximately £80 million per annum by the end of fiscal 2013. The total cost of the changes which have been identified is expected to be £160 million, of which £77 million was taken as an exceptional charge this year
•Diageo expanded its presence in faster growing markets: a controlling stake in Serengeti Breweries in Tanzania, an equity stake in Halico in Vietnam, the acquisition of Mey Icki in Turkey, an additional investment in ShuiJingFang in China and a controlling stake in Zacapa super premium rum, totalling £1.6 billion
Diageo is set to report a 5% rise in annual profits to £2.9bn on Thursday, on sales of £10.1bn.