Diageo cool on revenues

DIAGEO has tempered sales expectations as it navigates global trade wars.

The owner of Gordon’s Gin, Guinness and Johnnie Walker whisky warned that fullyear sales are expected to grow at the lower end of forecasts of between 4pc and 6pc.

Amid concerns about rising tariffs on drinks such as whisky, chief executive Ivan Menezes said: ‘There is ongoing uncertainty in the global trade environment and we would not be immune from further policy changes.’

Diageo, the world’s biggest spirits maker which sells 200 brands in 180 countries, hailed a ‘good’ half-year performance as net sales increased by 4.2pc to £7.2m for the six months to December 31.

It said Guinness accounts for one in ten pints of beer drunk in London, giving the brand its highest market share in the capital on record. It said demand was boosted by increased marketing spend, including its association with Six Nations rugby.

The company was strengthened by sales growth for Tanqueray gin in the UK, which offset a slight decline in Gordon’s sales.

The £70bn firm called for ‘de-escalation’ in America’s trade war with the EU, after President Trump put a 25pc tariff on scotch whisky. Diageo has also been hit by ‘increased levels of volatility’ in India, Latin America and the Caribbean and travel retail.

Sales growth for the full year to the end of June will be close to 4pc, lower than previous estimates of 5pc and a slowdown on last year’s growth of 5.8pc in the same period.

Shares fell 2.6pc, or 81p, to 3029p. Menezes said: ‘Diageo has delivered another good, consistent set of results.’