'Robust' off-trade helps drive Diageo sales in Europe

Ivan Menezes Diageo

The chief executive of Diageo has said off-trade sales remain strong in Europe.

Ivan Menezes, who was quoted in a statement today ahead of the company’s AGM, said the business in Europe is recovering ahead of company expectations. “Off-trade demand has remained robust and there is good momentum in the on-trade,” he said.

Of the overall business he said: “We have made a strong start to fiscal 22, with organic net sales momentum across all regions. This reflects excellent execution, as we benefit from resilience in the off-trade and continued recovery in the on-trade. However, we expect near-term volatility to remain, including the potential impact of any future waves of Covid-19.”

Elsewhere, Menezes said the North American business is “performing strongly” despite some supply chain constraints, while he expects volatility in Africa, Asia Pacific and Latin America and the Caribbean to persist.

“We expect organic operating margin to benefit from a further recovery in sales volumes, positive channel mix and premiumisation trends, while we are continuing to invest in our marketing and commercial capabilities. As previously indicated, we are managing rising inflationary pressures, which are partly due to supply chain constraints.”

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