In a recent press release reporting its 2017 interim results, Diageo has shown an overall stronger performance compared to the previous year. Within the last 6 months, the company's reported net sales increased by 14.5% at £6,421 million and its operating profits by 28% at £2,065 million. The highest increase in net market came from Latin America and the Caribbean, which contributed 11% of organic movement, led by scotch. The company’s strategy focuses on three priority areas: scotch, the US, and India.

Getting back on track after a negative cycle

Diageo's Chief Executive, Ivan Menezes, commented, "Highlights this half include improved performance in our US spirits business and across our scotch portfolio, driven by our focus on marketing with impact, innovating at scale, expanding our route to consumer, and winning in reserve.”

The company has only been around since 1997. It has reportedly missed its targets for 2015/2016 and lost £330 million in net sales in the 12-month period ending June 2016, due to declines in sales in the North American market.

Diageo has an extensive portfolio in North America, selling North American whiskey brands, Crown Royal and Bulleit, scotch, and tequila. The brands include global giants Johnnie Walker, Smirnoff, and Baileys, with a line of rising local brands and reserves.

All five regions contributed to the alcoholic drinks producer's overall sales growth last year, but not equally. Organic net sales growth were up 6% for scotch, 7% for gin, 15% for North American whiskey, and 18% for tequila.

A new Dublin whiskey distillery is underway

Following the strong performance review, Diageo announced in January that it is planning to launch a new premium whiskey brand.

The company plans on investing €25 million (£18.6 million) over 3 years on a whiskey distillery located in St. Jame’s Gate, Ireland. The brand is to be called Roe & Co, after George Roe, a world-famous whiskey maker who contributed to Irish whiskey’s golden era.

Minister for Jobs, Enterprise and Innovations, Mary Mitchell O’Conner, said of Diageo’s move, “It is great to see Diageo continue to invest in and further enhance the historical Dublin 8 area to create a fantastic attraction for tourists and locals alike.”

According to Diageo’s Chief Executive, the company is confident about its goal of achieving the medium-term objective of “consistent mid-single digit top line growth and 100bps of organic operating margin improvement in the three years ending 30 June 2019”.
© ALL RIGHTS RESERVED