Diageo plc publishes re-presented US Dollar financial information

09 Oct 2023|Press release

Important Information

This document contains selected unaudited re-presented historical consolidated financial information of Diageo group (Diageo plc and its subsidiaries - Diageo) as of and for the years ended 30 June 2021, 30 June 2022 and 30 June 2023 and the six months ended 31 December 2021 and 31 December 2022 reflecting a change in the presentation currency of Diageo plc from sterling to US dollar. This document is published to help the understanding of Diageo's past performance and financial position on a represented basis, in US dollar. Diageo's unaudited interim financial statements as at and for the six months ending 31 December 2023 will use US dollar as the presentation currency.

Further re-presented financial information including re-presented consolidated statement of changes in equity and consolidated statement of cash flows will be published for the years ended 30 June 2021, 30 June 2022 and 30 June 2023 in January 2024.

This document also contains certain non-GAAP measures, including organic movements, calculated and reconciled to the relevant GAAP measure in US dollar. These non-GAAP measures are chosen for planning and reporting, and some of them are used for incentive purposes. The group’s management believes that these measures provide valuable additional information for users of the financial statements in understanding the group’s performance. These non-GAAP measures should be viewed as complementary to and not replacements for the comparable GAAP measures and reported movements therein. Note that the representation to US dollar did not result in any material change to organic growth movements for any of the periods, geographical segments or key categories. See “Definitions and reconciliation of non-GAAP measures to GAAP measures” for more information.

Change in the functional and presentation currency

Starting 1 July 2023, in line with reporting requirements, the functional currency of Diageo plc has changed from sterling to US dollar which is applied prospectively. This is because the group's share of net sales and expenses in the US and other countries whose currencies correlate closely with the US dollar has been increasing over the years, and that trend is expected to continue in line with the group's strategic focus. Diageo has also decided to change its presentation currency to US dollar with effect from 1 July 2023, applied retrospectively, as it believes that this change will provide better alignment of the reporting of performance with its business exposures.

The selected unaudited re-presented financial information included in this document has been derived from the consolidated financial statements and accounting records of Diageo for each of the years ended 30 June 2021, 30 June 2022 and 30 June 2023 and for each of the six months ended 31 December 2021 and 31 December 2022, prior to retrospectively applying the change in the presentation currency.

The selected historical financial information that was included in the consolidated financial statements of Diageo as at and for the years ended 30 June 2021, 30 June 2022 and 30 June 2023 and as at and for the six months ended 31 December 2021 and 31 December 2022 has been re-presented in US dollar following the translation methodology in IAS 21 - The Effect of Changes in

Foreign Exchange Rates:

  • assets and liabilities were translated into US dollar at the closing exchange rate prevailing at the relevant balance sheet date;
  • the consolidated income statement and the consolidated cash flows of non US dollar entities were translated into US dollar at weighted average rates of exchange for the relevant period, except for subsidiaries in hyperinflationary economies that were translated with the closing rate at the end of the relevant period and for the substantial transactions that are translated at the rate on the date of the transaction (including acquisitions, disposals, impairment write offs, dividends received and paid);
  • total equity was translated at the closing exchange rate at the relevant balance sheet date.

In preparing the selected unaudited re-presented financial information in US dollar included in this document, the exchange rates used in respect of sterling and euro per $1 were:

  Year ended
30 June
2023
Six months ended
31 Dec
2022
Year ended
30 June
2022
Six months ended
31 Dec
2021
Year ended
30 June
2021
Sterling
Income statement and cash flows1 0.83 0.85 0.75 0.74 0.74
Assets and liabilities2 0.79 0.83 0.83 0.74 0.72
Euro
Income statement and cash flows1 0.96 0.98 0.89 0.86 0.84
Assets and liabilities2 0.93 0.94 0.96 0.88 0.84

(1) Weighted average rates
(2) Closing rates

Future Dividend Payments

Diageo adopted new articles of association (New Articles) at the AGM held on 28 September 2023 which reflect the change in the functional currency of Diageo plc and presentation currency of the group from sterling to US dollar. The New Articles, among other things, empower the Board to declare and/or pay dividends in any currency or currencies and enable the Board to make provisions for shareholders to receive dividends in a different currency to the currency in which dividends were declared. Commencing with the interim dividend for the year ending 30 June 2024 which is expected to be declared in January 2024, Diageo’s future dividends will be declared in US dollar. Holders of ordinary shares will continue to receive their dividends in sterling but will have the option to elect to receive their dividends in US dollar. Holders of ADRs will continue to receive dividends in US dollar.

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Contacts

Contacts

Investor enquiries to:
Durga Doraisamy
+44 (0) 79 021 26906

Andy Ryan
+44 (0) 78 038 54842

Brian Shipman
+1 917 710 3007

[email protected]

Media enquiries to:

Clare Cavana
+44 (0) 77 517 42072

Isabel Batchelor
+44 (0) 77 319 88857

[email protected]