Diageo’s Full-Year Sales Rise 6.5% To Nearly $22 Billion
August 1, 2023Diageo has posted organic sales up 6.5% to £17.1 billion ($21.8b) for its fiscal year through June despite a volume decline of 0.8%. Operating profit grew 7% organically to £4.6 billion ($5.9b), as price increases more than offset cost inflation. The company noted that premium-plus brands comprised 63% of reported net sales, marking a seven percentage point increase from its fiscal 2019.
While Diageo’s global sales advanced in the year through June, its core U.S. spirits business was down 1%, impacted by the post-pandemic normalization trend and tough comps especially in the second half of the year. Depletion growth was about two percentage points ahead of shipments, however. Tequila continues to drive gains, with U.S. net sales for Casamigos and Don Julio up 14% and 13% respectively, and depletions rising ahead of shipments.
Diageo’s single malt Scotch range jumped 25% in the U.S., driven by ultra-premium Lagavulin 16-year-old and luxury innovation Lagavulin 11-year-old Charred Oak Cask, while Buchanan’s grew 10%, boosted by its new Pineapple flavor. In vodka, Smirnoff grew 4% in the U.S., lifted by both the core offering and flavors, while Ketel One was flat. But Bulleit, Crown Royal, Johnnie Walker, and the RTD portfolio all slipped on tough comps from the prior year, although depletions continued to perform ahead of shipments in most cases. Total North America sales grew 11% on a reported basis to £6.8 billion ($8.7b), boosted by currency exchange, but were flat on an organic basis.
“In fiscal 23, we drove double-digit organic net sales growth in Scotch, Tequila, and Guinness, with our premium-plus brands contributing 57% of overall organic net sales growth,” said Diageo CEO Debra Crew. “North America delivered stable performance as the US spirits industry continued to normalise post-pandemic, and we lapped strong comparators, particularly in the second half of fiscal 23. Globally, we gained or held share in over 70% of total net sales value in our measured markets in fiscal 23. I am also proud of how our Diageo family has come together in recent weeks following the loss of our much loved and respected former CEO, Sir Ivan Menezes.”
Looking ahead, Diageo said it continues to expect “to deliver our medium-term guidance of consistent organic net sales growth in the range of 5% to 7% and sustainable organic operating profit growth in the range of 6% to 9%,” with a gradual sales improvement expected through the end of calendar 2023 and into 2024.—Daniel Marsteller
| Diageo Top Seven Brands in the U.S. (millions of 9-liter case depletions) |
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| Rank | Brand1 | Origin/Type | 2021 | 2022 | Percent Change2 |
|---|---|---|---|---|---|
| 1 | Smirnoff | Domestic Vodka | 8.9 | 8.8 | -1.7% |
| 2 | Crown Royal | Canadian Whisky | 7.5 | 7.2 | -3.1% |
| 3 | Captain Morgan | Virgin Islands Rum | 5.4 | 5.3 | -1.2% |
| 4 | Ketel One | Imported Vodka | 2.6 | 2.5 | -3.6% |
| 5 | Casamigos | Tequila | 1.8 | 2.4 | 34.5% |
| 6 | Don Julio | Tequila | 1.8 | 2.1 | 12.5% |
| 7 | Johnnie Walker | Scotch Whisky | 2.0 | 2.0 | -0.7% |
| Total Top Seven | 30.0 | 30.3 | 0.9% | ||
| 1 Includes flavors, excludes RTDs. 2 Based on unrounded data. Source: IMPACT DATABANK © 2023 |
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Tagged : Buchanan's, Bulleit, Casamigos, Crown Royal, Diageo, Don Julio, Johnnie Walker, Ketel One, Lagavulin, Smirnoff
