Preliminary results, year ended 30 June 2011Download file

A strong business, getting stronger

Results summary

  • Stronger second half performance with improved price/mix and operating margin expansion led to 5% organic growth of net sales and operating profit for the full year. Volume growth remained at 3%
  • Volume growth and price/mix driven by 16% growth in scotch in the emerging markets and 24% growth in the reserve brands portfolio in the developed markets
  • Gross margin expansion of 70 basis points driven by improved mix in emerging markets and North America, and efficiencies across our Global Supply operations
  • Organic marketing spend up 8% to 15.5% of net sales, mainly in emerging markets and for key spirits brands in the United States
  • Continued strong free cash flow of £1.7 billion
  • Recommended increase in the final dividend of 6%
  • In May Diageo announced an operating review which is expected to reduce cost of goods and operating costs by approximately £80 million per annum by the end of fiscal 2013. The total cost of the changes which have been identified is expected to be £160 million, of which £77 million was taken as an exceptional charge this year
  • Diageo expanded its presence in faster growing markets: a controlling stake in Serengeti Breweries in Tanzania, an equity stake in Halico in Vietnam, the acquisition of Mey Icki in Turkey, an additional investment in ShuiJingFang in China and a controlling stake in Zacapa super premium rum, totalling £1.6 billion

Paul Walsh, Chief Executive of Diageo, commenting on the year ended 30 June 2011

"Diageo is a strong business as these results show. Our leading brands and superior routes to market have delivered volume growth, positive price/mix, gross margin expansion and strong cash flow. We have strengthened the business, investing more behind our brands and in our routes to market and we have deepened our leading brand and market positions in the fastest growing markets of the world. In addition we have implemented changes to drive further operational efficiencies.

While Diageo is not immune from a fragile global economy, this is a strong platform. It is the basis of our medium term outlook for average organic top line growth of 6%, organic operating margin improvement, with the first 200 basis points achieved in the next three years, and double digit eps growth. Achievement of these aims would underpin even stronger dividend growth."

Related media

2011 preliminary results Investor presentation Download file
25 Aug 2011

Presentation slides to accompany the 2011 preliminary results Investor webcast READ MORE...

2011 preliminary results Investor presentation script Download file
25 Aug 2011

Script of the 2011 preliminary results Investor presentation

2011 preliminary results media presentation Download file
25 Aug 2011

Presentation slides to accompany the 2011 preliminary results media webcastREAD MORE...

2011 Preliminary Results Press Kit
25 Aug 2011

View and download key resources relating to our 2011 preliminary results announcement. READ MORE...

Interim Management Statement for the three months ended 30 September 2011 Download file
19 Oct 2011

Diageo delivered 9% organic net sales growth in Q1


Resource Finder ?

This resource finder searches all resources within the Investor section of the site. Filter the resources on the page using the toolbar.