Diageo, the owner of Guinness and Smirnoff, this morning announced it will hike its dividend despite the impact of coronavirus restrictions on pub and bar sales.
Reported net sales fell 4.5 per cent during the second half of the year, while operating profit declined 8.3 per cent to £2.2bn.
Organic net sales increased one per cent despite the impact on travel retail and on-trade restrictions as Diageo pivoted to cater for at-home drinking.
The drinks giant, which also owns Gordon’s gin and Captain Morgan’s rum, increased its interim dividend for the six months ended 31 December to 27.96p per share, up two per cent on the previous year.
Net sales in Britain jumped two per cent despite restrictions on pubs and bars across the country during the half-year period as consumers bought alcohol to drink at home.
Sales of spirits soared 15 per cent, driven by market share gains in supermarket sales.
Beer sales declined, but jumped when restrictions on pubs and bars were eased.
Diageo chief executive Ivan Menezes said: “We delivered a strong performance in a challenging operating environment, returning to top line organic sales growth during the half.
“We rapidly pivoted to the channels and occasions most relevant to consumers and invested behind new opportunities. This more than offset the impact of on-trade restrictions and the decline in Travel Retail.”
He added that Diageo expects “ongoing volatility and disruption” going forward, “which will make performance more challenging”.
“The medium and long-term growth drivers and opportunities for our business remain intact and I am confident in our strategy, the resilience of our business and Diageo’s ability to emerge stronger,” Menezes said.