Diageo Profit Jumps 17% as Margins Rise
LONDON (
) --
Diageo
(DEO)
, the maker of Guinness beer and Johnnie Walker whiskey, said Thursday full-year profit rose 17% on improved price/mix and expanding operating margins.
Diageo earned 1.9 billion pounds ($3.11 billion) for the year ended June 30, up from 1.63 billion pounds a year earlier.
Sales rose 2% to 9.94 billion pounds. Organic net sales gained 5%.
The company, the world's biggest spirits maker, said gross margin expanded 70 basis points on "improved mix in emerging markets and North America."
In a statement, Paul Walsh, Diageo's CEO, said in the medium-term the company expects average organic top line growth of 6%.
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Diageo said sales rose 3% in North America, 9% in Asia Pacific and 13% in other international markets. Sales in Europe declined 3%. It experienced 24% growth in its reserved brands, such as Johnnie Walker and Ketel One vodka.
Diageo's report is in contrast to a report Wednesday from
Heineken
, the largest seller of beer in Europe, which warned of weak demand in developed markets after first-half earnings declined.
-- Written by Joseph Woelfel
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