Stronger organic growth underpins improving momentum across the business
- Organic results improved with volume growth of 1.3%, net sales growth of 2.8%, and operating profit growth of 3.5%
- Reported net sales declined 3.0% as organic growth in each region and acquisitions were more than offset by adverse exchange and disposals
- Reported operating profit grew 1.6% with organic growth, lower exceptional operating charges and acquisitions partially offset by adverse exchange and disposals
- Free cash flow continued to be strong at £2.1 billion, up £134 million on last year. Operating cash flow was £2.5 billion
- Basic eps of 89.5 pence was down 6% as lower exceptional income reduced basic eps by 6.1 pence. Pre-exceptional eps increased 1% to 89.4 pence
- The board recommended a final dividend increase of 5% bringing the full year dividend to 59.2 pence per share
Ivan Menezes, Chief Executive, commenting on the results said:
"This is a good set of results delivering what we set out to achieve this time last year and demonstrating our momentum.
This better performance reflects the work we have done to strengthen our big brands through marketing and innovation, as well as expanding our distribution reach. Our six global brands and our US spirits business are all back in growth and we have seen a significant improvement in the performance of our scotch and beer portfolios. The delivery of volume growth; organic margin expansion; increased free cash flow; and the disposal of £1bn in non-core assets, comes from an everyday focus on efficiency in each aspect of our business. We have also made significant progress this year in our aim to improve the role of alcohol in society, partner with our communities and reduce our environmental impact.
These results position us well to deliver a stronger performance in F17. We are confident of achieving our objective of mid-single digit top line growth, and in the three years ending F19 delivering 100bps of organic operating margin improvement.”