Diageo sees share price slide after warning about sales

Spirits and beer giant Diageo PLC saw billions wiped off its market value on Friday after it warned that a sharp slowdown in its business in Latin America and the Caribbean was hitting sales and potential profits.

In early trading in London, the company’s share price was down by 14% after it told investors that it expects growth in the first half of the current financial year to be slower than the previous half-year.

It blamed a “materially weaker” outlook in Latin America and the Caribbean as a result of “macroeconomic pressures” and customers switching to cheaper products. The region accounts for around 11% of Diageo’s total sales.

That was a surprise for investors as the company, which counts Johnnie Walker whisky, Captain Morgan rum and Guinness among its stable of brands, had previously indicated a “gradual improvement” in sales growth.