Diageo blames sales fall on decline in beer drinking
Diageo, the maker of Guinness, blamed a decline in beer drinking for a four per cent fall in stout sales in Ireland and one per cent fall overall.
The company is said to be contemplating a move away from its "good things come to those who wait" ethos by experimenting with a quick-pour tap.
The announcement came as the company revealed a five per cent drop in group sales to £6.48bn in the six months to December 31, largely because of the disposal of the food business, Pilsbury.
Turnover from continuing operations rose nine per cent on an organic basis and pre-tax profits rose 13 per cent to £1.28bn.
The Smirnoff vodka brand enjoyed 59 per cent growth in net sales following the continuing success of Smirnoff Ice premium packaged spirit.
The company is working to exit food businesses such as Burger King, where sales fell 29 per cent to £79m, while adding drink brands in deals such as last year's £3.5bn buy-out of Captain Morgan rum and other Seagram brands.
Star performers in the half-year were Diageo's global priority drinks brands, which include Johnnie Walker and José Cuervo tequila.
Diageo said share buy-backs were a priority for the second half. Some observers expect them to top £1bn.
The timing is unclear because of the impending disposal of Malibu, the rum brand that must be sold to satisfy US regulators. Allied Domecq, Pernod Ricard and Fortune Brands have all submitted first round bids.
Related stories:
InnSpired attacks Guinness for failing to join support scheme (1 March 2002)
Guinness considers 'quick pour" tap (27 February 2002)
Guinness Draught in a Bottle put on back burner (20 February 2002)
