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Diageo - An apology - just-drinks thinks

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With six years at the helm now under his belt, Diageo CEO Ivan Menezes has endured and enjoyed a rollercoaster ride of a time - and, that's putting it mildly.

In July 2013, Menezes took over the leadership of a company that, under previous incumbent Paul Walsh, had enjoyed four consecutive years of low-to-mid single-digit sales growth. After posting flat sales in 2009, Diageo then went on to increase annual sales by 2%, 5%, 6% and 5%, respectively, in the subsequent four years.

Enter Menezes, however, and things started to slow down markedly. So much so that, in his first two full years in charge, Diageo's top-line stagnated, with zero growth in fiscals 2014 and 2015.

The performance prompted me, in July 2015, to ask: "Is Diageo approaching its 'Et tu, Brute' Moment?" I vividly remember the group's presentation that summer of its results for the 12 months to the end of June 2015: The bullish sounds coming from senior executives failed utterly to hide the glum faces and the weight of pressure on their shoulders.

Since then, however, the only way has been up, with annual sales rising with each year, hitting the heady (for Diageo) heights of +6.1% in fiscal-2019 - a decade-high.

Diageo Sales Growth - 2009-2019

Source: just-drinks

So, when Menezes sounded the happiest I've heard him when we spoke after the results announcement yesterday, we can forgive him. We can even allow him to flag to analysts that "the strength of the results is ... at levels that he hasn't seen before".

For the hard time that we - and others - have given him in the past, it seems only fair to now say - Sorry. For now!

Why the spirits category should look backwards to move forwards - Click here for a just-drinks comment


Expert Analysis

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Key Trends in Alcoholic Beverages: Powerful changes shaping the wine, beer, spirits and alcohol-free beverages industry...

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