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26 JUL 2018

26 JUL 2018 Press release

Press release

2018 Preliminary Results, year ended 30 June 2018

Strong performance reflects consistent and rigorous execution of our strategy

  • Reported net sales (£12.2 billion) and operating profit (£3.7 billion) were up 0.9% and 3.7%, respectively, as organic growth was partially offset by adverse exchange
  • All regions contributed to broad based organic growth, with organic net sales up 5.0% and organic volume up 2.5% 
  • Organic operating profit was up 7.6%, improving organic operating margins by 78 basis points, as higher marketing investment was more than offset by efficiencies from our productivity programme
  • Cash flow continued to be strong, broadly in line with last year, with £3.1 billion net cash from operating activities and £2.5 billion free cash flow
  • Basic eps of 121.7 pence was up 14.8%. Pre-exceptional eps was 118.6 pence, up 9.3%, principally due to higher organic operating profit
  • On 26 July the Board approved a share buyback programme to return up to £2.0 billion to shareholders during the year ending 30 June 2019
  • The Board recommended a final dividend increase of 5% bringing the full year dividend to 65.3 pence per share

Ivan Menezes, Chief Executive, commenting on the results said:

“Diageo has delivered another year of strong, consistent performance. Organic volume and net sales growth is broad based across regions and categories. We have expanded organic operating margin while increasing investment behind our brands ahead of organic net sales growth.

These results reflect the high performance culture we have created in Diageo, the ongoing rigorous execution of our strategy, our focus on the consumer and our ability to move swiftly on trends and insights.

During the year we returned £1.5 billion to shareholders through a share buyback.  We have delivered another year of strong cash flow generation in F18. Consequently, the Board has approved an additional share buyback programme of up to £2.0 billion during F19.

The changes we have made in the business and the shifts in culture we continue to drive, ensure we are well placed to capture opportunities and deliver sustained growth. Our financial performance expectations are unchanged and we expect to continue to invest in the business to deliver our mid-term guidance of consistent mid-single digit organic net sales growth and 175bps of organic operating margin expansion for the three years ending 30 June 2019.”

ENDS

Enquiries

Investor enquiries to:

Andy Ryan
+44 (0) 20 8978 6504

Pier Falcione
+44 (0) 20 8978 4838

Sharon Rolston
+44 (0) 20 8978 1219

investor.relations@diageo.com

Media enquiries to:

Jessica Rouleau
+44 (0)20 8978 1286

Clemmie Raynsford
+44 (0)208 978 1221

Bianca Agius
+44 (0) 20 8978 1450

Dominic Redfearn
+44 (0) 20 8978 2749

press@diageo.com

About Diageo

Diageo is a global leader in beverage alcohol with an outstanding collection of brands across spirits, beer and wine categories. These brands include Johnnie Walker, Crown Royal, J&B, Buchanan's and Windsor whiskies, Smirnoff, Cîroc and Ketel One vodkas, Captain Morgan, Baileys, Don Julio, Tanqueray and Guinness.

Diageo is a global company, and our products are sold in more than 180 countries around the world. The company is listed on both the London Stock Exchange (DGE) and the New York Stock Exchange (DEO). For more information about Diageo, our people, our brands, and performance, visit us at www.diageo.com. Visit Diageo’s global responsible drinking resource, www.DRINKiQ.com, for information, initiatives, and ways to share best practice.

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