Diageo’s net Irish sales down 5%

Drinks giant Diageo, the maker of Guinness and Baileys, has reported a 5% year-on-year fall in net sales at its Irish operations for the first six months of the year.

This was due to further contraction in the alcoholic drinks market, which saw volumes decline by another 1.2% in the 12 months to the end of June.

Despite this, the group’s headline brands — Guinness and Smithwick’s draught — grew value share in the pub trade, with Guinness maintaining a 32% share of the Irish beer market.

On top of that, the iconic stout managed to grow its global sales by 4% during the first half of this year, compared to the same period in 2011.

Diageo’s Irish-produced brands — such as Guinness, Baileys, Bushmills Whiskey, and Smithwick’s — are exported to more than 150 countries. Diageo Ireland’s country director, David Smith, said they have more than played their part in the group’s overall success.

On a group basis, Diageo had a good first half — pre-tax profits up by over 32%, year-on-year, to £3.12bn (€3.94bn), and sales up nearly 11% to £14.6bn.

Mr Smith said: “We’re proud of our strong export growth. In the past 12 months, our three top export brands have shown positive growth, with Guinness growing 4% across the world, Baileys’ net sales in China growing by 42%, and Bushmills delivering double-digit increases in net sales, with a particularly strong performance in Eastern Europe.”

Guinness’s net sales were up 2% in developed markets and by 8% in Africa. Nigeria is now the biggest single market for the drink as measured by net sales.

Diageo’s group chief executive, Paul Walsh, noted that the company remains a strong business which is getting stronger.

“We have increased our presence in the faster growing markets of the world — through both acquisitions and strong organic growth — we have enhanced our leading brand positions globally, and we have strengthened our routes to market,” he said.

In regard to Diageo Ireland, Mr Smith noted that the previously announced plans to invest €153m in upgrading and expanding the iconic Guinness Brewery at St James’s Gate sows the seeds for the future growth of the company here and “will allow us to compete even more strongly from our Irish export base”.


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