Guinness sales drop 5% at home

SALES of Guinness in its home market fell by 5% over the course of the past year, according to latest figures from parent company, Diageo.

The international drinks giant yesterday reported a 6% rise in operating profit to £2.57 billion (€3.15bn) and a 5% rise in net sales to £9.8bn for the 12 months to the end of June. It said that group net sales in Ireland fell by 8% in its latest financial year.

This figure covers its total Irish-based product portfolio, which also includes the likes of Harp, Smithwicks, Baileys and (the distribution of) Carlsberg and Budweiser.

On its own, net annual sales of Guinness fell by 5% here, but the iconic stout brand did manage to marginally increase its market share in the Irish on-trade/pub sector (to 32.6%); which it has now done for the past 30 consecutive months.

According to Diageo, Guinness accounts for one in every three pints bought in a pub in Ireland and generates 12% of Diageo’s total group net sales.

Guinness’ market share increase was partly driven by last year’s inaugural “Arthur’s Day” event, celebrating the brand’s 250th anniversary. The day of that first annual event, September 24, 2009 saw 720,000 people visit a pub here – almost half a million more than numbers for an average September’s Thursday evening.

Diageo said that Guinness’s sales slip in Ireland (net sales remained flat in Britain, but outperformed the total beer market there) was in line with the general market decline.

Smithwicks and Harp also grew market share, over the year; while Carlsberg performed broadly in line with the market and Budweiser lost market share.

On a group-wide basis, meanwhile, Diageo saw its overall sales rise driven by a better second half than first half and good performances in its developing markets, while its more established markets – such as Europe and North America – remained weak.

Group chief executive, Paul Walsh called the period “a year of challenges and opportunities” but added that organic operating profit growth can be improved on further next year.

“The impact of the global economic crisis varied by market and the strength of the recovery appears to be equally variable,” Mr Walsh added.