More profit served by Fife-linked drinks giant

INDUSTRY: Diageo stresses importance of good access to markets after Brexit vote

Drinks giant Diageo reported net sales growth for the full year and said it is on track to deliver on its 2017 growth plans.

The Smirnoff and Guinness drinks maker, which employs more than a thousand people in Fife, saw volume growth of 1.3%, net sales growth of 2.8% and operating profit growth of 3.5%.

Free cash flow continued to be strong at £2.1 billion, up £134 million on last year. Operating cash flow was £2.5bn.

Basic earnings per share of 89.5p was down 6% as lower exceptional income reduced the level by 6.1p.

The board recommended a final dividend increase of 5% bringing the full year dividend to 59.2p per share.

Chief executive Ivan Menezes said: “This is a good set of results delivering what we set out to achieve this time last year and demonstrating our momentum.

“This better performance reflects our work to strengthen our big brands through marketing and innovation, as well as expanding our distribution reach.

“Our six global brands and our US spirits business are all back in growth and we have seen a significant improvement in the performance of our Scotch and beer portfolios.

“The delivery of volume growth, organic margin expansion, increased free cash flow and the disposal of £1bn in non-core assets comes from an everyday focus on efficiency.

“We have also made significant progress this year in our aim to improve the role of alcohol in society, partner with our communities and reduce our environmental impact.”

The results position Diageo well to deliver a stronger performance in 2017, and the group was confident of achieving its objective of