“A soft first half performance was further exacerbated by on-trade closures,” stated the multinational which pointed out that Rockshore here continued to show “double-digit” growth through Rockshore Cider and high single-digit growth was reported in Rockshore Lager despite Covid-19 lockdown restrictions.
“This was offset by declines in Guinness, driven by closure of the on-trade and further impacted by a keg return scheme to support customers and maintain product quality,” stated the company.
Total spirits declined 10% as off-trade sales increases were not sufficient to offset Covid-19-related closures in the on-trade, stated Diageo.
Globally beer sales, which account for 15% of Diageo’s net sales, declined by around 15% with Guinness sales declining by 16%.
Organic net sales at Diageo plc were down 8.4% while organic volume sales were down 11.2%, with reported net sales down 8.7% to £11.8 billion “driven by organic declines”.
Organic operating profit at the multinational was down 14.4%, with reported operating profit down 47.1% to £2.1 billion “driven mainly by exceptional operating items and organic net sales”.
Fiscal 20 was a year of two halves said Diageo Chief Executive Ivan Menezes, “After good, consistent performance in the first half of fiscal 20, the outbreak of Covid-19 presented significant challenges for our business, impacting the full year performance.
“We have taken decisive action through the second half of fiscal 20, tightly managing our costs, reducing discretionary expenditure and reallocating resources across the group,” he continued, “We are further enhancing our data analytics and technology tools to rapidly respond to local consumer and customer shifts triggered by the pandemic.
“While the trajectory of the recovery is uncertain, with volatility expected to continue into fiscal 21, I am confident in our strategy,” he concluded.