Diageo plc (DEO) - Get Report  shares surged to the top of the FTSE 100 in London Thursday after the drinksmaker posted slightly stronger-than-expected full year earnings and boosted its near-term margin improvement targets thanks to solid growth in India and the United States. 

The maker of Johnnie Walker Scotch and Smirnoff vodka said operating profits for the full fiscal year, which ended on June 30, hit £3.6 billion ($4.72 billion), modestly firmer than the FactSet consensus of £3.58 billion and up 25% from 2016. Group sales, Diageo said, rose 15% to £12.1 billion, topping the FactSet forecast of £11.96 billion. Diageo also said it would lift its margin improvement objective to 175 basis points from 100 basis points over the three years ending in June 2019.

The group also announced a £1.5 billion share buyback program for the fiscal year ending in June 2018.

"We delivered a strong set of results including broad based improvement in organic net sales and operating profit. Our performance demonstrates the effective delivery of our strategy through disciplined execution of our six priorities put in place four years ago," said CEO Ivan Menezes. "We have delivered consistent strong performance improvement across all regions and I am pleased with progress in our focus areas of US Spirits, scotch and India."

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"Our productivity work is delivering ahead of expectations allowing us to reinvest in our brands, drive margin improvement and generate consistent strong cash flow," he added. "Through productivity we have embedded an everyday efficiency mind set in the business and with improved data and insight we are making faster, smarter decisions on investment choices."

The group also announced a £1.5 billion share buyback program for the fiscal year ending in June 2018.

Diageo shares were marked 6.4% higher in the opening minutes of trading in London to change hands at 2,420 pence each,  extend their year-to-date gain to just under 15% compared to a 4.34% advance for the benchmark FTSE 100.

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