Diageo’s Irish brands continue to grow
Bushmills whiskey drives growth as Guinness slows in Western Europe
Guinness had a 33 per cent market share in Ireland, although its 1 per cent increase globally was driven by sales in Africa.
Diageo’s Irish brands continued to grow in its latest fiscal year, the company said, with Bushmills leading the charge with a 12 per cent rise.
The whiskey was particularly popular in Russia and Eastern Europe, notching up growth of 36 per cent. Sales of Baileys were 2 per cent higher globally, Diageo said.
Although net sales of Guinness grew by 1 per cent globally, the majority of the growth was seen in Africa, the drink’s largest market by value. In other territories, sales of the black stuff fell, with Western Europe showing a 3 per cent decline.
In Ireland, Diageo’s brands faced tough markets with both the beer and spirits markets contracting. But despite the tough trade environment, Guinness held a 33 per cent market share, and sales of Captain Morgan and Bushmills rose by 2.3 per cent and 7.5 per cnet respectively. Baileys grew by 9 per cent.
“The trading environment may be challenging, but Diageo remains committed to the Irish market and working with Ireland to build a stronger economy,” Diageo’s country manager for Ireland David Smith said.
In the UK, Smirnoff lifted the spirits of the drinks giant in the UK after the vodka’s improved trading performance offset weaker sales of Guinness.
Guinness sales were 3 per cent lower in the UK in the year to June 30th, but there was encouragement from a better final quarter on the back of greater marketing. Smirnoff sales grew 4 per cent worldwide - ahead of the wider market - while other successes in the UK included the launch of Pimm’s Blackberry & Elderflower and the expansion of its range of pre-mix drinks cans.
Ivan Menezes, who took over as chief executive from Paul Walsh earlier this month, said the effectiveness of Diageo’s marketing campaigns had helped the company extend its market positions for a number of brands.
“This has been a key driver of our performance in scotch, our biggest and most profitable category, especially for Johnnie Walker which is now a 20 million case brand.”
Profits in North America rose 9 per cent to £1.5 billion, offsetting a fall of 9 per cent to £656 million in western Europe. Asia Pacific grew 21 per cent to £414 million, despite a second half slowdown in China as a result of an “anti-extravagance” campaign launched by the government.