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Diageo posts upbeat H1 figures as recovery kicks in - results

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  • First-half net profits climb by 6.4% to GBP1.58bn (US$1.98bn)
  • Net sales in six months to end of December jump by 14.5% to GBP6.42bn
  • Operating profits also leap, by 28% to GBP2.07bn
  • ForEx contributes, but all regions post sales lifts
  • Diageo's H1 results by region - Focus

Diageo has reported a healthy set of first-half numbers, with sales rising strongly on the year-prior period.

CEO Ivan Menezes has overseen an impressive start to fiscal-2017 for Diageo

CEO Ivan Menezes has overseen an impressive start to fiscal-2017 for Diageo

The group said earlier today that net sales in the six months to the end of December rose by almost 15% on the corresponding period in fiscal-2016. Net and operating profits were also up, by over 6% and 28%, respectively.

Volumes dipped by 1% on a reported basis although, in organic terms, volumes were up by just under 2%.

The top line benefitted from the devaluation of the Pound since the EU referendum at the end of June, with ForEx adding GBP853m to the top line. In the same period a year ago, exchange pulled net sales down by GBP282m. For fiscal-2017, Diageo said it expects exchange rate movement to "favourably impact" net sales by around GBP1.4bn.

On a regional basis - and in reported terms - Latin America and the Caribbean shone in the first half, with the region's sales jumping by 20%. North America, Diageo's largest region, posted a 16% rise in sales, with Europe, Russia & Turkey and Africa both up 13%. Asia Pacific saw its net sales in the period increase by 12%.

"We have delivered a strong set of results with broad-based improvement in both organic volume and top-line growth," said CEO Ivan Menezes. "Highlights this half include improved performance in our US spirits business and across our Scotch portfolio."

Looking forward, the company said it is maintaining its "medium-term objective" of "consistent mid-single digit" sales growth.

Diageo's share price has responded favourably to today's results. At 1006GMT, shares were up 4.5% at GBP22.38.

To read the official results statement, click here


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